There is no single approach that works for every debt situation. Different options may have different requirements, benefits, costs and risks. Understanding how they work can help you have a more informed conversation about what may fit your situation.
Four Common Ways to Address Debt
Debt settlement
A provider may work with an enrolled consumer to negotiate with creditors in an effort to resolve eligible unsecured debts for less than the amounts owed.
What to consider
Results are not guaranteed. Credit may be negatively affected, collection activity may continue, and forgiven debt may have tax consequences.
Debt consolidation loan
A new loan may be used to pay off multiple existing debts, leaving the consumer with one new loan to repay under its terms.
What to consider
Approval generally depends on factors such as credit and income. Rates, fees and repayment terms vary by lender, and consolidation does not necessarily reduce the total amount repaid.
Credit Counseling and Debt Management Plans
A credit counseling organization may help a consumer review their finances and, in some cases, establish a debt management plan with structured payments to participating creditors.
What to consider
Consistent monthly payments are generally required. Creditor participation, concessions, fees and program length can vary.
Bankruptcy
Bankruptcy is a legal process that may allow certain debts to be discharged or restructured through the courts.
What to consider
Bankruptcy can have significant legal, financial and credit consequences. A qualified bankruptcy attorney can explain how the process may apply to an individual situation.
Harbor Relief provides general educational information and does not provide legal, tax, bankruptcy, credit repair or financial advice or recommend one approach over another. Availability, costs, eligibility and outcomes vary based on the provider, creditor, debt type, state and individual circumstances.
What Can Affect Which Debt Options May Fit?
Your debt situation is made up of more than just the amount you owe. Factors such as the type of debt, your income, credit profile and ability to keep up with payments can all affect which options may be available.
There is no single approach that works for everyone.
An option may be worth exploring based on:
How much unsecured debt you have
The types of debt you are trying to manage
Whether you have a steady source of income
Your current credit profile
What you are hoping to accomplish with your debt
Important things to understand:
Eligibility varies by provider
Not every debt qualifies for every option
Costs and terms can vary
Some approaches may affect your credit
Results are not guaranteed
Certain options may not be available in every state
The right approach depends on your individual circumstances
A participating provider can review your situation and explain available options, eligibility requirements, potential costs and risks.
What Types of Debt May Be Eligible?
Common types of debt we may be able to help with
Credit cards
Personal loans
Medical bills
Collections
Some private student loans
Certain personally guaranteed business debts
Generally outside our focus
Mortgages
Auto loans
Federal student loans
IRS or state tax debt
Child support
Alimony
Court fines
Most secured debt
Available options depend on the participating provider, debt type, credit profile, state and individual circumstances.
Not Sure Which Path Fits?
Answering a few questions can help clarify whether a participating provider may have an option relevant to your situation.
Starting the questionnaire does not enroll you in a program.
Harbor Relief is an independent consumer matching and referral service. We are not a lender or debt settlement provider and do not make loans, make credit decisions or negotiate debts. Participating providers determine eligibility, approval and terms. Submitting information does not guarantee approval, savings or any particular outcome.
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