Debt Solution For The Jobless
Channel: debtreliefusa
Date: 2013-12-04

Debt Solution For The Jobless

Have you ever wondered what is the best debt solution for the jobless? One thing's for sure, if you do not have the steady income to support your basic expenses, then it will be very hard for you to pay off your debts. While your debts are important, survival is too.

Fortunately for you, there are still two options for you to get out of debt. Definitely, you need debt reduction and that makes your choices limited. For one, debt consolidation loans are not part of your debt solution options. It can only restructure your debts and you will still end up paying for the rest of what you owe.

So what debt solutions can you use when you are jobless?

One of your options is debt settlement. This is also known as debt mediation, debt negotiation or debt reduction. The goal of this debt solution is to convince your creditors or debt collectors that you are in a severe financial crisis. Since you do not have a job at the moment, this is an accurate description of your financial state. You want the creditor to believe the crisis because you will negotiate with them to allow you to pay only a portion of your debt.

The debt settlement process works best when you have already falling behind on your payments. If you do not have a job, this is not unlikely to happen. You must have missed a couple of payment already. But even as you default on your payments, you must grow a debt settlement fund. You need to have the cash to offer your creditor/debt collector. You will tell them that when you pay them this settlement fund, even if it is smaller than what you owe, it should suffice to close your credit account. Upon receiving this amount, the rest of the debt will be forgiven.

The other option that you have for a debt solution is bankruptcy. This is another debt relief option for the jobless. There are two ways that you can go from here. One is Chapter 7 or the liquidation bankruptcy and the other is Chapter 13 or repayment bankruptcy. You will go through a means test to determine which one you will be qualified for.

In Chapter 7, any non-exempt asset that you own will be sold and the proceeds will go to your different creditors. What is not paid will be discharged. In Chapter 13, you will be subjected to a repayment plan. Just like in debt settlement, this will only pay for a portion of the debts that you owe. Anything that is not included here will be discharged.

These options will get you out of debt even if you are jobless. These debt solutions will result in a lower credit score but that is the price you have to pay for the payment defaults in debt settlement or the discharging of debts in bankruptcy. But then again, if that means you get debt freedom then that may be a small price to pay to get out of debt.

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