Decision on Debt

After reviewing our debt options we have put together some scenarios to help you decide the best course of action for your debt situation.  In each scenario, we give you an example and a suggested decision to help meet your particular circumstance.

Scenario #1 – You have more equity in your real estate than the unsecured debt you want to pay off.

Choice is Debt Consolidation secured by a Home Equity Loan provided, however, that the equity loan interest rate is at lest 25% less than the current average rate you now pay.

Scenario #2 - You have equity in your real estate that is greater than 50% of the unsecured debt to be paid off.

Choice is Optimum Solution (Combination of Debt Consolidation & Debt Settlement)

Scenario #3 - You have the ability to raise 50% of the unsecured debt to be paid

Choice is Optimum Solution (Combination of Debt Consolidation & Debt Settlement)

Scenario #4 – You can consistently pay 20% or more above the required minimum monthly payments.

Choice is Accelerated Payment Plan

Scenario #5 - You feel your cash flow problems are short term (6 –12 months), because your income will increase substantially in the next year or you will have a drastic reduction in your expenses, or you can consistently pay at least 3% of the unsecured debt each month, during this period.

Choice is Credit Counseling to reduce interest rates and extend payments.

Scenario #6 -
– You can consistently make at least 2 ½% of the unsecured balance each month.

Choice is Debt Settlement – this amount goes into your set aside fund.

Scenario #7 -
– You cannot pay the monthly minimums because your income is too erratic but may be able to accumulate 50% of the total unsecured debt by setting aside what payments you can save and possibly borrow the balance in a 24-36 month period.

Choice is Debt Settlement

Scenario #8 - If you are unable to raise significant funds or have no way of making even the monthly minimum payments.

Choice is Bankruptcy

We hope that the decision-making examples we just covered gave you some guidance on the right path to proceed for your financial future.

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