Debt Free Advocates is a professional website aimed at educating the customers to select the best alternative for handling their debt. There are several debt relief alternatives for consumers who are buried in debt. The important ones are listed below:

Debt Settlement Program:

• A debt settlement program reduces the total outstanding debt by 50-70% of the original balance
• One can be debt free in as little as 3-36 months
• Usually provides a custom designed payment arrangement that fits your situation and can finally get you out of debt
• Not only reduces the total amount of debt, but also can get you out of debt and satisfy your creditors all at the same time
• Helps rebuild your credit and avoid bankruptcy
• It’s a win – win situation!!!! You are out of debt and you pay off creditors!!!!
• Debt reduction programs such as one offered by www.debtfreeafterall.com provides an easy and convenient payment method. They are professionals experienced in debt settlement, debt reduction, and debt negotiation.

Credit Consolidation/Counseling Programs:

• Credit counseling programs get some interest reduced without any reduction of the actual balance
• Scientific studies have shown that credit counseling does not work 95% of the time, because people get frustrated at the slow pace and lack of progress and drop out, only to find themselves back where they begin
• There are no credit counseling programs that will eliminate credit card debt faster while saving you a substantial amount of money
• Many clients who join credit counseling programs file bankruptcy like chapter 7 or chapter 13

Bankruptcy: In Bankruptcy, a US federal court declares that the person is unable to pay the debts. The court either cancels the debts or minimizes them to an extent where one can pay them off in 3-5 years. For some, bankruptcy is the right choice, while for some it might not be. There are two types of bankruptcies:

Chapter 7:

• This is a most difficult form of bankruptcy.
• One should make less than the median income.
• If one makes more than the median income, they will be subjected to a “means test”.
• If court determines that the person has resources to pay, then the case could be converted to Chapter 13.
• This bankruptcy erases most of the unsecured debts such as credit cards and medical bills.
• Means Test
    ° Figure your six months monthly income.
    ° Subtract monthly child-support payments, taxes, student loans, and other items that the court cannot or will   not dismiss.
    ° Based on the remaining income-if you do not have enough money to pay at least $100 a month of your    unsecured creditors over the next five years, you will qualify for Chapter 7 and your unsecured debts could    be dismissed.
    ° On the other hand, if you do not have enough money to pay at least $100 a month, you may be required to   file Chapter 13.
  

Chapter 13 :

• This requires borrowers to repay at least some of their debts before erasing others.
• If one makes the required payments, which is called “disposable income”, the unpaid balances will be erased.
• If one does not make the required payments, the bankruptcy will be dismissed and the creditors can resume their collection efforts.
• Disposable Income
    ° Figure your six months monthly income.
    ° Subtract monthly child-support payments, taxes, student loans, and other items that the court cannot or will   not dismiss.
    ° Then deduct your monthly “living expenses” set by IRS.
    ° The amount remaining is your “disposable income” which must be paid to your creditors. .
    ° If your income is above your state’s average income for your family size, you will make monthly payments for   at least five years. If it is below your state’s average income for your family size, you will make payments for   at least three years.

  How Does People Get Into Huge Debt?

  TIPS for Getting Out of Debt

  Types of Debts

  Debts and its Other Facets