Debts can impact your financial status miserably. But you can take control of your finances before they get out of hand. Opting for debt consolidation can be the first step to a debt free life
There is no second thought that debt consolidation program can bail out debtors who are struggling to keep pace with their personal debts and the high rate of interest. Debtors often resort to debt consolidation programs to cope with their debts.
However, if a debt consolidation program is suitable for a particular debtor, the same program may not be suitable for another. To find out as to which debt relief method best suits an individual, the first thing a debtor should do is to take help from an efficient debt counselor who will be able to guide the debtors better and give suggestions accordingly. Avail a debt counseling session from an expert debt counselor.
A good debt counselor works in close association with the debtors and works out a budget so that the debtors can spring back to a healthy financial condition. He can suggest a method which suits your financial needs best so that you can become debt free within a very short time period.
Debt has been a major cause of concern in the last couple of years and it worsened to lead to the subprime loan crisis lately. .
Debt has taken the world by storm-
During the period 1970 to 1980, there were many low income nations whose debts had started building up due to several factors. Some of the factors included-
· Fall in commodity prices
· Low rate of economic growth
· Economic shocks suffered by several countries
These factors led to the ‘unsustainable debt burdens’. Reports indicate that by the year 1992, as many as 33 indebted low income nations had debts which had increased manifold and was much higher than their yearly export
Light at the end of tunnel
However, light at the end of the tunnel was seen when multilateral lenders such as International Monetary Fund, the World Bank and various other regional development banks took initiatives to introduce debt relief programs.
The World Bank and its role in debt relief
The MDRI or Multilateral Debt Relief Initiative (set up in the year 2006) and Debt
Relief Initiative for Heavily Indebted Poor Countries or HIPC (set up in thee year 1996), the World Bank Group extends debt relief to the nations with low income.
As many as 33 nations are receiving debt relief assistance from the World Bank under both or any one of the initiatives. As of 2006, the debt relief initiative was worth USD$70 billion NPV or Net Present Value (taking into consideration the participation of all the creditors).
Despite the fact that the World Bank is extending assistance to the low income nations, some of the other factors that lead to financial crisis worldwide may be attributed to the emerging economies, which do not get sufficient protection, the presence of unregulated free markets and the measures adopted for the structural adjustments are some of the other factors.
When can you not discharge debts through Chapter 7 bankruptcy?
Chapter 7 bankruptcy gives you the option of getting out of debt within 3-4months. However, this option is not available for everybody. This article talks about the 4situations when debtors can’t qualify for Chapter 7 bankruptcy.
Should you obtain a personal loan to throw debt out of your door?
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Does repossession eliminates your car loan debt?
If you have defaulted on car loan debt, then having your vehicle repossessed will not satisfy your debt. You may still owe money to your creditor. Moreover, repossession will lower your credit score. Therefore, it is better to find out alternative ways to pay off the car loan debt.
