Debt elimination advantages and disadvantages

Many of us have experienced the burden of debt, whether through credit cards or student loans, tax liens or a home mortgage. The fundamental problems with debts happen to be they won’t go away unless you take a proactive approach and deal with the issue head on. If you’re financial status is not up to date and you are facing debt problems since quite some time, perhaps debt elimination is the correct solution for you.

Talking about debt elimination raises questions such as “Can you just legally cancel debts?” – The answer is “Yes, it’s possible if done in the correct way.” So that gives rise to another question “Then what’s the correct way?” The answers to that question are too many, since individuals have unique thinking patterns and each person feels “I am right” A probable “answer” might be the solutions offered by debt elimination companies, which concentrate more upon the “end result” of reducing your debt, rather than debate over the list of probable answers.

Debt elimination pros and cons

As in case of many debt reduction and credit repair strategy, debt elimination plan presents its own set of advantages and disadvantages. Outlined below are major pros and cons associated with the facility. People tend to offer different view points regarding the benefits and argue over the disadvantages. However, from the “market” point of view, the ground reality does exhibit some key features which both support and discourage the concept.

Advantages of debt elimination

Cost effective in nature.

Simple process and leads to a stress free life.

Stops harassment from debt collectors.

Can effectively reduce your debt significantly if don in the correct manner.

Negative feed back or “bad” and “poor” credit status can be removed through systematic use of the process. It’s possible to repair your credit status.

Debt elimination programs do not require collateral security

Disadvantages of debt elimination

You lose the credit cards and their associated accounts which you're defaulting on.

Can take from 4-10 months if the accounts are still active and have yet to be handed over to a debt collection agency.

Cannot use the facility for business related debts. Debt elimination programs are only available on personal unsecured debt.