Some creditors may be willing to offer settlements for less
than what you owe, but you should consult an accountant to be sure that you won't owe taxes for the amount of debt
written off in the settlement. Companies may issue a 1099 tax form at the end of the year, which may be required
to be added to your tax return as taxable income.
Borrowing money to consolidate your loans only works if you get a better rate
and have a plan to get out of debt. Moving debts from one place to another is not a solution in most cases.
Debt Management plans are structured plans that consolidate your debts into one
package. Make sure that the company you chose is reputable and isn't putting you into a program that doesn't leave enough
money to pay your regular living expenses. Debt management programs affect credit ratings and participation in them is voluntary
on the part of the creditors. One creditor refusing to participate can ruin the entire plan to get out of debt with a Credit
Counseling Debt Management program.
Alternatives To Bankruptcy, By Cathy Moran
Debt Consolidation, Debt Management, And Debt Negotiation, by Jed Berliner
Debt Settlement Companies, Debt Negotiation, Debt Consolidation Billed As Bankruptcy Alternatives, But Are They Really? by