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Debt Relief for Mounting Debts Doesn’t Happen Overnight.

Need debt relief, but not sure where to turn? You're not alone. Millions of Americans are carrying more debt than they can afford. Add in high interest rates and late payment penalty fees and before long, consumers owe double or triple of what they borrowed.

There are many debt relief companies who promise they can convince credit card companies and lenders to lower interest rates. For a fee, these companies claim they can reduce monthly payments, slash outstanding balances and help consumers get out of debt in a matter of months instead of years. Unfortunately, many companies offering debt solutions are nothing more than scam artists preying on innocent and desperate victims

This is not to say all debt relief organizations are scammers. There are legitimate companies that can help consumers obtain relief from mounting debts. However, considerable caution should be taken when retaining services from anyone claiming they can reduce or eliminate your debts.

The truth of the matter is no one can eliminate your debts overnight. Even if you file for bankruptcy, there is a very real possibility that you will have to pay a portion of what is owed. In 2005, President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act. BAPCPA requires debtors to undergo the "means" test to determine their financial ability to repay debts.

Prior to BAPCPA, the majority of people filed for Chapter 7 bankruptcy protection. Chapter 7 involves liquidation of non-exempt assets and provides debtors with a clean slate. Today, few people are granted the option of Chapter 7 and instead are forced into filing Chapter 13 bankruptcy.

Chapter 13 requires submission of a repayment plan through the bankruptcy court. The repayment plan is usually spread out over 36 to 60 months. Debtors are required to pay a large percentage of their monthly earnings toward their repayment plan. If debtors miss their payments, their creditors can petition the court and request the judge dismiss the bankruptcy. If the judge agrees with creditors and dismisses the bankruptcy, debtors are right back where they started and no longer have protection from the bankruptcy court.

One of the best ways to obtain debt relief is through credit counseling. There are several free credit counseling programs available online. offers an abundance of financial advice including credit repair, debt elimination and bankruptcy.

The U.S. Trustee Program offered through the U.S. Department of Justice provides a list of approved credit counseling agencies and debtor education providers. Anyone who plans to file bankruptcy is required to obtain credit counseling from one of their approved agencies. Regardless of whether you are planning to file bankruptcy or simply seeking quality debt relief services, the U.S. Trustee Program is a good place to start.

Many people are able to obtain debt relief through good old fashioned budgeting. While budgeting requires self-discipline, it doesn't cost a dime and only requires time and commitment. By taking time to thoroughly review your finances and create a workable budget, debtors can strategically widdle away their debts.

Relief from debt is possible. However, you must take time to become educated about finances and budgeting. The Internet is a good place to start, but use caution prior to handing over money to anyone who claims they can provide debt relief for a fee. Engage in due diligence and research debt relief companies through the Better Business Bureau or by conducting research online.

We invite you to learn more about debt relief, debt consolidation, debt settlement, credit counseling, budgeting and money management in our comprehensive article database. New articles are frequently added, so please bookmark and come back often!