Start New Financial is Your #1 Debt Relief Company

Getting credit counseling assessment, advice, education and guidance, enrolling in a debt management program, debt consolidation borrowing, debt settlement offers, filing for bankruptcy, are common strategies of debt relief options. With Start New Financial’s expertise and experience, coupled with our empathy and integrity, you’re in the best hands if you’re serious about becoming debt-free. The moment you call us in your FREE phone consultation you begin to smell or sense financial freedom.

Start New Financial individualizes the best debt relief option fit for you

Credit Counseling

Our certified credit counselor thoroughly assesses and evaluates your entire financial and personal situation to determine the best solution for you and educates you as well, helping you with your budget & managing of all your debts.

Debt Management

Using debt relief strategies, such as negotiating with your creditors, to help you lower your current interest rates and debts and move toward structurally eliminating them completely is what debt management is all about. We’re #1.

Debt Consolidation

When it becomes difficult for you to keep track of your multiple debts that have over- whelmed you, and whose payments you’re also having a hard time making, you may need a debt consolidation program. We roll them into just 1 lower monthly.

Debt Settlement

You mutually agree with your creditor to pay back a portion of your debt in a debt settlement agreement and the remainder of the debt is forgiven, which is money you save while also becoming debt-free quicker. We get the most favorable terms.

What is a Debt Relief Program?

Programs, measures, and plans that can help a debtor get relief from the burden of debt are basically what debt relief consists of. In order to make it easier for the borrower to repay their debt, a debt relief company offers a wide variety of different debt relief services that entail several different debt relief programs to refinance, minimize, or eliminate debt altogether. Generally, in a debt relief scheme, combining multiple debts into a single, lower-interest loan, lowering the interest rate, and/or forgiving a portion of the debt’s principal are relief results that are obtained in some of the options available for reduction of your debts. For the most part, during just about every debt relief option or program, the debtor ends up not having to pay the whole amount of debt when they pay off the debt in its entirety.

Debt consolidation and debt settlement programs are the most popular forms of debt relief.

What is a debt relief program? As you can appreciate from the list below, the list of debt relief options available is very big and diverse, for there are debt relief programs for every type of debt if you know how to find them. A debt relief program is one that will help and benefit you in your quest to become debt free, when compared to if you had done nothing or not joined one (a debt relief program). These include the following:

  • Credit Counseling
  • Debt Consolidation Programs
  • Debt Consolidation Loans
  • Debt Settlement Programs
  • Bankruptcy
  • Credit Card Debt Relief
  • Student Loan Debt Relief
  • Tax Debt Relief
  • Debt Management
  • Deferment
  • Mortgage Debt Relief
  • Auto Loan Debt Relief
  • Paying the Monthly Balance
  • Payday Loan Debt Relief
  • Medical Debt Relief
  • Federal Government Debt Relief Programs
  • Federal Student Loan Repayment Plans
  • Loan Modification
  • Public Service Loan Forgiveness
  • Fresh Start Program (aka Fresh Start Initiative) for IRS Tax Relief
  • Home Affordable Refinance Program (HARP)
  • Forbearance
  • Debt Forgiveness
  • Workout Arrangements
  • Settlement Agreements
  • Voluntary Surrender
  • 401(k) Loans and Lines of Credit
  • Cancellation of Debt
  • Mortgage Forgiveness Debt Relief Act of 2007 Extended into 2018
  • Refinancing

Advantages of Debt Relief Programs

The fact that you’ll receive assistance from seasoned debt experts is a major advantage of a debt relief program. Advice, counseling, and financial guidance are included. Financial assistance finds you the benefit of lower monthly payment rates that suit your current financial situation, and you obtain a plan that works best for your spending behavior. You are kept from seizable portions of debt with financial assistance and your debt is paid in less time. Becoming free of debt ASAP for less is a great advantage.

Disadvantages of Debt Relief Programs

The negative impact that debt relief generally has on your credit score is the primary disadvantage of debt relief programs. Your debt might not be guaranteed to be reduced no matter what plan in an adept relief scheme you choose. You must do your homework thoroughly and shop around as well, because you must know the different options available to you when getting involved in one of these plans, so you can get to choose the ideal one that best works for you and you don’t wind up in a worse financial situation, such as paying taxes on unpaid debt.

You are never alone when you have Start New Financial in your corner. The budget we build for you is realistic with a financial plan you can easily follow. We lower, freeze, or completely eliminate your interest rates and consolidate your credit bills into reduced monthly payments in the amount that most comfortably best works for you. Over-limit charges and fees are eliminated and all harassing calls from debt collectors are ceased. That is how we have helped thousands of Americans say goodbye to their debts.

Two of the most common types of debt relief programs out there are debt settlement and debt consolidation programs. Most people are referring to these two specific types of programs when they talk about finding debt relief help. You can get out of debt with the help of one of these professional relief services. When you can’t solve challenges with debt by yourself, you just have to enroll in these programs to get your much-needed relief.

Other options for relief

When you’re not sure you need professional help, there are other options you can use to find relief. Keep in mind that debt relief is what any solution that gives you a cheaper, easy, or fast way to get out of debt is referred to as. There are plenty of do-it-yourself debt relief options to consider besides formal debt relief programs. You can work directly with a creditor or lender to find a solution you can afford.

Deferment

With the debt relief option of deferment, you are allowed to temporarily suspend your debt payments. Without incurring penalties you get your lender’s approval to pause your monthly payments. A great thing about this option is that it also doesn’t negatively affect your credit at all.

Except in specific circumstances, during deferment interest charges still accrue. For example

  • You defer the payment of your federal student loan until you leave school if it is subsidized. While you attend school, your great government pays interest charges.
  • The payments are deferred if your loans are unsubsidized, and then conversely they are deferred but interest charges do accrue. This means that while you attend school the amount you owe increases.

It is most common on student loans that deferment is applied to. Other types of debt, however, can possibly be deferred as well. The only thing that is required is the lender’s approval. Give your servicer a call to inquire if they offer debt deferment. If you can’t make your payments because you’ve had a temporary setback, then this is a good option for you to explore.

Forbearance

Similar to deferment is a debt solution called forbearance. Monthly payments are entirely suspended or reduced via the lender’s agreement. Deferment periods are generally longer than forbearance periods. When you first experience financial hardship, if you contact the lender they will typically grant you forbearance. Start New Financial advises you to request forbearance BEFORE you fall behind if you think you won’t be able to make your payments.

It is typical for mortgages and student loans, the type of debt relief option that is forbearance. Even with subsidized federal student loans, interest charges almost always accrue unlike in deferment. To qualify for forbearance is usually easier than it is for deferment. Credit card debt and other types of debt can also work in forbearance.

Refinancing

Refinancing permanently changes a loan, while forbearance and deferment for a period of time just change your payment schedule. Lowering the interest rate applied to the debt is the goal of refinancing. Refinancing also generally provides other benefits, such as lower monthly payments.

Over the length of your term you are able to save money because your rate was lowered.

  • Private student loans, auto loans, and mortgages are some of the debt that can be refinanced. Your credit score is what qualifies you for a new interest rate. You may have to pay closing costs once again if you refinance a mortgage.
  • Student loans have no federal program available to refinance them; a private lender is what you must go through in order to refinance such.
  • It is simply known as interest rate negotiation when you lower the rate on a credit card.

Only when you can qualify for a lower rate is refinancing the right choice. This means you need a better credit score than when you took out the loan. Other factors can affect your interest rate as well, which you should keep in mind. For instance, the Federal Reserve raises rates in a strong economy. Refinancing is made less beneficial by this.

Settlement Agreements

In this type of relief you settle your debt for less than you owe, similar to a debt settlement program. However, multiple debts are handled at once through a settlement company in a settlement program. In settlement agreements, on your own you negotiate settlement agreements with your collectors or individual creditors.

There are two ways to set up individual settlement agreements:

  1. A collector sends you a settlement offer to negotiate a settlement.
  2. A collector accepts a settlement offer you send them.

Debt forgiveness

Debt is erased without penalties with true loan forgiveness (also called debt forgiveness). Your debt is forgiven without credit penalties or added fees by your creditor once you meet certain eligibility requirements. The credit bureaus receive a paid-in-full report on the debt by your creditor.

This is a rare circumstance, as you can imagine. Federal student loan debt is the type of debt that most commonly gets applied debt forgiveness to. But to qualify you must be in a public service profession such as teaching, nursing, or the military.

Tax debt forgiveness is also another debt relief having to do with debt forgiveness. You must, however, prove that you are not legally responsible for the tax debt. In Innocent spouse cases is where this generally happens. You must prove that without your knowledge your spouse incurred tax debt.

Loan Modification

The terms of a loan agreement are permanently changed with a loan modification, much like with refinancing. A modification can change the length of the term or the principal amount, while refinancing reduces the interest rate. You can also switch from a fixed rate to an adjustable. Most of the time, you modify it to get lower payments or to fit your needs.

The most common types of loan modification are mortgages. Modification matches the principal to the property value if your home is worth less than the remaining mortgage balance. During the mortgage crisis in 2008, modifications were rampant. The federally subsidized modification program (HAMP) however ended as of January 1, 2017, resulting in less modifications.

Workout arrangements

A repayment plan that you set up with an individual creditor is what a workout arrangement is. Credit cards are the only ones eligible for this relief option. When you want to avoid a charge-off if you fall behind, the creditor will set up a payment plan you can afford after they first freeze your account.

The creditor will “re-age” your account in some cases. They bring your account current by telling the credit bureaus to remove late payments. Any damage to your credit score caused by missed payments is removed by this.

Voluntary Surrender

Giving up property that is attached to a loan as collateral is called voluntary surrender involves. You get out of the agreement like this. In an auto loan, for instance, the phrase¬† ‘voluntary surrender’ specifically refers to giving up a vehicle to get out of the (auto) loan. Voluntary repossession is also another way to put it.

To avoid foreclosure on your home, you can also use a voluntary surrender option that is there for that. The name for it is deed-in-lieu of foreclosure. During the mortgage crisis of 2008, this was such a common relief option for American homeowners. Homeowners were allowed to make a clean break and avoid foreclosure with programs like ‘cash for keys’ that were offered by many lenders.

You must be aware that it doesn’t mean you avoid credit damage when you use voluntary surrender. It will hurt your credit the fact that your obligation to repay the loan still was not met by you.

Deficiency judgments may also be faced by you. To cover their losses, voluntary surrender allows the lender to sell the property. But the lender still retains the right to sue you for the difference if the sale doesn’t cover the full balance.

How Debt Relief Affects Your Credit

Depending on which debt relief option you use is how your credit score will be affected. Your credit should be neutrally or positively impacted by any solution that pays back everything you borrowed or owed. Eliminating fees or reducing interest charges does not result in credit damage. On the other hand, any solution that gets you out of debt for less than the full amount owed damages your credit score.

As long as you make all your payments as scheduled, refinancing will not damage your credit. The same is true of a modified loan or a consolidation. Your credit will not be negatively affected just because you negotiated a lower rate on a credit card. Since the creditor agreed to change your payment schedule, forbearance and deferment also do not hurt your credit.

The impact is usually positive or neutral of credit card debt management programs and workout arrangements. You build a positive credit history and avoid missed payments with the help of these solutions. Using these solutions, most credit users don’t see any damage to their credit. The accounts will however be closed by these methods. The damage is usually nominal but this can usually have a slight negative effect on your credit.

Your credit is a tad damaged by debt solutions such as short sales, voluntary surrender, and debt settlement. For each of these, you incur a seven-year negative mark on your credit report. A seven-year credit penalty also results from Chapter 13 bankruptcy and foreclosure. A 10-year penalty is carried by a Chapter 7 bankruptcy.

Bad Ideas For Debt Relief

You might think that debt reliefs such as bankruptcy and settlement would be bad ideas for you. But they are still viable strategies for finding relief for your debt even though these solutions may damage your credit. You make a clean break from debt when you declare bankruptcy, so you can move forward in a positive, empowered way.

On the other hand, people are put in a weaker financial position than when they started by several options out there. These solutions increase your assets or your financial risk. They actually put you behind even though they wipe out your debt. You want to avoid these solutions whenever possible.

Tapping Home Equity

Cash-out refinancing, home equity lines of credit (HELOCs) , and home equity loans use home equity to provide debt relief. To pay off debt the equity in your home is used by you as collateral to basically borrow against it. When you have a lower credit score, this can especially seem like a good solution. When a loan is secured using your home as collateral, it’s easier to get a low interest rate.

But your financial risk increases significantly with these. You risk foreclosure if you default on any of these options. You could lose the place you call home, which might be your most valuable asset. You generally want to leave home equity alone and not touch it. For building net worth, your home equity is often the largest asset you have when you borrow against equity. A liability is what you’ll turn your asset into. Literally speaking, net worth is calculated by taking total assets minus total liabilities i.e. your debts. That becomes a problem when you go to open a new loan because your assets-to-liabilities ratio won’t be where you need it to be. So, it can actually make it harder to borrow when your solution is to avoid hurting your ability to borrow.

Using Retirement Funds

To pay off debt, we do not recommend tapping your IRA or 401(k). You lose the growth you would have enjoyed on those funds as well as funds you take out. Your retirement can be set back by you by years or even decades.

In addition to draining your retirement funds, you can face early withdrawal penalties if you take out money before the age of 59 on a traditional IRA or 401(k). Since it’s considered taxable income, you will have to pay 10% of the money you withdraw as penalties for early withdrawal. You could additionally be required to pay taxes on the money you withdraw. These taxes and penalties do not apply to a Roth IRA.

It still cannot be understated the amount of savings and time that you lose by making an early withdrawal. If you drain the funds now, you could be forced to work part-time through retirement or to delay your retirement.

If you take out money before the age of 59 on a traditional IRA or a 401(k), you can drain your retirement funds in addition to facing early withdrawal penalties. Start New Financial has all types of great debt relief options and programs from which we can help you select the best one for you to get you out of debt ASAP for less than what you owe.

We customize an individualized debt relief program tailored to best work for you so you can finally become debt free seamlessly, enjoying peace and happiness. Just remember, for debt relief help, all you need to do is call Start New Financial for your FREE phone consultation.

CALL START NEW FINANCIAL FOR A FREE ANALYTICAL REVIEW

There are many forms and variations of borrowing to consolidate debt, some of which include an IRA Loan, Annuity Loan, Bank Personal Loan, Credit Union Personal Loan, Peer-to-Peer Lender Personal Loan, PayDay Loans, Finance Company Loan, Home Equity Loan, Home Equity Line of Credit, 401(k) Loan or even a Note loan. All of which will be explained to you by a certified loan expert from Start New Financial, giving you the best guidance to quickly manage your debt and become debt free.

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