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Debt counselling can save consumers endless headaches and sleepless nights by negotiating with their creditors in order reduce minimum monthly payments to the extent that consumers can afford them. Each case of debt counselling is done on an individual basis, and therefore there is no direct monetary figure to show how much money debt counselling can save a consumer, however if we look at the following facts, the savings gathered from debt counselling should become clear:
- Debt counselling can prevent asset loss by shielding the consumer from asset seizure notices as long as they remain under debt counselling. This means consumers can save their houses and other assets.
- Debt counselling can dramatically reduce interest and penalty fees attached to debts through negotiations, thus although payment may take longer, consumer are working toward paying off a capital amount and not just putting out interest fires.
- Debt counselling can prevent costly legal fees because it protects the consumer against legal action from creditors due to lapsed payments. Therefore for the time that the consumer is under debt counselling, creditors may sent notices but may not take legal action.
- Debt counsellors are able to reduce monthly payments by nearly 50% with expert negotiations.
- By extending payment periods, debt counselling can free up disposable income that can be channelled toward a savings account, thus enabling the consumer to create a nest egg for future financial emergencies.
Debt counselling is designed to alleviate financial burdens for consumer by dramatically reducing their monthly debt obligations and saving them money in the long run by avoiding bankruptcy and asset loss.
Article written by: Andrea van Tonder 06-2013