Frequently Asked Questions

Here are the answers to the most commonly asked questions about becoming debt free.

How long does it usually take to get debt free?

Every consumer is different. How long it takes you to get out of debt will depend on a host of factors, including the size of your debt, your interest rates, the debt solution you choose, and your commitment level. As a general rule, however, if your repayment plan for unsecured debt takes you longer than 7-10 years, you may be better off declaring bankruptcy. Talk to a debt expert for a more specific timeline.

Is it possible to get out of debt on my own?

Of course you can overcome your debt through your own efforts. Millions of people have done it before, so it would not be unprecedented. On the other hand, if debt is something you struggle with, you might lack the tools and knowledge you need to pay it off successfully. Additionally, even if you are very savvy with your debt, your interest rates may simply be too high. A professional debt intervention can help you with both of these obstacles.

Is there such a thing as "good" debt?

Yes, some types of debt are more helpful than others. Generally, secured debt tends to be more manageable and worthwhile than unsecured debt. Common types of secured debt include mortgages and car loans. This kind of debt usually has more reasonable interest rates than unsecured loans like credit cards or cash advances. Moreover, when you finish paying off a house or a car loan, you will own something of value. By contrast, credit card debt is often the result of frivolous purchases, such as dinners out or lavish vacations that will not be around once the debt is paid off.

Do I need to have a certain level of debt to qualify for professional interventions?

This will depend on the type of debt solution you select. With credit counseling services, anyone can seek out assistance. There are usually no qualification criteria or minimum debt requirements. On the other hand, debt consolidation companies do tend to require that their customers have a minimum level of unsecured debt before they can participate. The most common minimum is $5,000, though this will vary by consolidation service.

Do I have to stop using my credit cards if I enroll in debt consolidation?

With any debt repayment program, you will have to stop charging items to your credit card if you're ever going to become debt free. Conventional debt consolidation companies make this easier by requiring clients to cancel the cards included in the consolidation program. Some services may allow you to retain one card for emergency scenarios. Once you consolidate and pay off your debt, you can of course open new credit card accounts, but you should avoid them altogether if you can.