Underground Journal

Choosing the Best Christian Debt Reduction Strategy for You

Christian debt reduction can take on many different forms and can be achieved through many different avenues.  Understanding the options available to you is the first step toward financial freedom.

If you need help developing a budget, starting a savings account, or repairing a credit score, then credit counseling is a great place to start.  A credit counselor can also help you understand each of the other debt reduction paths and can help you choose the one that is best for you.

A debt management plan may be suggested if, after developing a budget, you find that you are still struggling to make minimum monthly payments on your loans.  Your credit counselor will manage the debt management plan and will do all of the negotiating and communicating with your creditors.  With a form debt management plan, you will make one monthly payment into an account, from which each of your creditors will be a paid a reduced amount.

Debt consolidation can also lower your monthly payments. With this method, you take out a new loan that covers all of your unsecured debt.  A consolidated loan always has lower monthly payments, but it is usually paid out over a longer period of time and may have a higher interest rate than the ones on your individual loans.  However, if lower monthly payments are of top priority, then this is a good choice for you.

Debt negotiation is a last resort, and should only be used if neither debt management nor debt consolidation is an option. Because it involves stopping all payments to creditors until a lump sum has amassed, it can cause severe damage to your credit report.  It should only be attempted if your accounts have either already become delinquent or have been written off by your creditors.

Each of these options has its merits and drawbacks.  Use the expertise available through Christian debt reduction services to help you choose the best one for you.

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