What is Debt Relief?
The phrase debt relief is used frequently and may mean many things. In realistic terms, debt relief is a way to get you out of hot water, through budgeting, contacting your creditors, debt consolidation, or filing bankruptcy. However, it is important to realize that in advertising terms, debt relief is synonymous with bankruptcy: many financial firms that advertise “debt relief” may be planning to usher you straight into bankruptcy court. If you need debt relief, there are several different options available to you. If you believe your financial hardship is temporary, you can contact your creditors and explain the situation to them. If the account has been in good standing in the past, chances are the creditor will agree to temporarily suspend your payment obligations. Such a favor doesn’t come without cost, of course: when you start making payments again, they’ll likely be higher to compensate for the past due amount. However, a few months of debt relief may help you get back on your
Debt relief is an umbrella term under which there are a number of financial products and also consumer spending modification programs that seek to put an end to the revolving debt trap. In essence, debt relief seeks to stop the accumulation of further consumer debt, while in some cases actually getting some of it forgiven. This latter process is pursued without the need for bankruptcy, and in a slowing economy with a recent increase in job losses, debt relief is a much sought after benefit at this time. How Does Debt Relief Work? Consumers — or hired professionals acting on behalf of individual consumers – contact the various creditors to whom money is owed. In many cases these are credit card companies that have offered credit at higher interest rates. Debt relief is then sought by renegotiating the contractual obligations with the credit company. Oftentimes this involves a reduction of the interest rate, a reversal of late and over credit-limit fees, and in some cases may also inclu
If you are one of the millions of Americans suffering from the credit crunch going on in the country right now, there’s a good chance you’re looking for some debt relief. But before you go out looking for it, it’s important to understand what it is and how it works. Debt relief comes in many forms, including debt consolidation, debt negotiation, credit counseling and debt management programs. However, it’s important that you choose the right option for you. More importantly, you need to understand what type of person you are. Debt consolidation and debt negotiation are great for the go-getters who want to attack their debt head-on and do it on their own. Not everyone is built like this though.
“Debt Relief” or “Mortgage Relief” is any net reduction in the amount of liability on the replacement property after the exchange, as compared to the amount of liability on the relinquished property just prior to the exchange. It will be considered boot and will result in the recognition of gain unless offset by the payment of additional cash by the exchanger.
