There are many questions that you may have when it comes to debt. If all of the debt FAQ's were listed here then it would probably take several minutes for this page to load in your browser.

Get Ready for Some Real Answers from an Attorney Based Debt Resolution Specialist

Below you will find several of the more popular questions and answers that we have encountered. These debt FAQ's have been categorized for your convenience.

Debt Consolidation

Q: What should I look for when choosing a particular debt consolidation company?

A: The first thing that you may want to do is to look for a reputable organization and possibly that they are an approved nonprofit organization. If you want to make sure they they are a bonafide nonprofit group then you can check with the IRS to see if they are exempt from taxes. Just about any Debt Consolidation Company can offer options to better your situation. On the downside, some solutions could actually make your situation worse. Take a look at what they can do for you and then use some common sense. Try to keep the big picture in mind.

Q: Will I be able to qualify for a credit card debt consolidation program or loan?

A: Keep in mind that credit card debt consolidation is not the best solution for everyone. It all depends on your situation. The only way to find out if you can qualify is to talk to a debt counselor who can review your particular situation. They can look at your debts and let you know which solution would be best for your needs..

Q: Is credit counseling necessary?

A: If you are in way over your head in debt then it may be a very good idea to enlist a credit counseling service. On the other hand, if you are facing bankruptcy, you will be required to get credit and debt counseling. It's better to get credit and debt counseling now while it is still an option for you.

Q: Will I be able to keep using my credit cards?

A: If you enlist in some type of debt consolidation service then you will need to surrender your credit cards. Continuing to use your credit cards would only add to the amount of debts that you are trying to pay off. An exception to this would be if you opt for a secured debt consolidation loan. These types of loans do not put a lien on your credit cards. You are given a loan to do with as you please. An example of a secured debt consolidation loan would be a second mortgage.

Q: Will my credit rating be affected if I choose to use one of the debt consolidation or debt settlement programs?

A: While you are enrolled in a debt consolidation program, you credit will be negatively affected. However, it will not be as bad as if you were to file for bankruptcy.

Q: If I opt for a debt consolidation program and make one monthly payment, can I choose my due date?

A: With most programs, the simple answer is yes. Every program has their own rules. Having the ability to choose your own payment date is a good idea because it gives you the ability to schedule your monthly payment for a time that is convenient when you consider all of your other living expenses.

Q: If I sign up for a debt consolidation service, will I still get my monthly statements from the creditors that are included?

A: With most solutions you should still get your monthly statements from your creditors. However, you won't pay these bills. The debt consolidation would be paying the bills and you would simply keep your monthly statements for your own records.

Q: Can debt consolidation companies and services really stop the harassment by my creditors?

A: Once you're enrolled in a debt consolidation program or service, you will probably still get calls from your creditors for a short period of time. Once you are enrolled in a program, you can simply tell this to the creditor or debt collector and tell them to call the debt consolidation company. Most debt programs will give you a phone number that you can use for this. In most cases, after they receive this information, you won't be called by them again.

Q: Once I am enrolled in a debt consolidation program, can I add more of my credit cards to the program?

A: This depends on your situation. Many programs will allow you to add more credit cards after enrollment but some will require you to list every creditor right from the start.

Q: Under a debt consolidation program, if I start to do better, can I send more money?

A: It's a good idea to select a debt consolidation program that will allow you to make extra payments so that you can pay them off faster. Even if you can only send a few dollars more than the minimum, it can make a big difference in the long run.

Q: How can I pay less interest on my credit cards?

A: For most credit cards, you can avoid paying interest if you pay your total balance before the end of the month. They don't charge interest right away after you make a purchase. There is usually an interest free period so that if you pay the entire amount before this period expires, there will be no interest charged.

Q: If I fall behind on my credit cards, can they garnish my wages or make me leave my house?

A: The short answer is yes. However, you would probably prefer to hear the long answer which is, in most cases, no. Keep in mind that your creditors cannot eat you. There are only certain things that they may do in order to collect debts. Much of what they can do depends on the laws in the state where you live. If you are in enough debt to worry about wage garnishments or losing your home, you should seek advice from a debt counselor.

Q: If I have too much credit card debt, can I go to jail?

A: Not really. It's not really a criminal issue to be in debt. This is best left to the civil authorities. Anyone can sue you and make your life miserable. If they do sue you and you fail to appear in court, then you could go to jail. If you find yourself in a situation where your debt is bad enough to scare you into thinking that you might go to jail then you should find a way to hire a lawyer as well as a debt counselor. Then you can be assured that you will not pass go and go directly to jail.

Q: If I have heavy credit card debt, can I just pay a certain percentage of the amount that is due?

A: This is where debt settlement comes into play. Sometimes called debt negotiation services, debt settlement companies can negotiate with your credit card companies in order to lower your monthly payments. This can be accomplished on your own as well. It should be noted that the credit card companies will be more willing to negotiate with you once you have been late with your payments. It is not fun to try to negotiate with credit card companies so you might want to seriously consider using a service for this.

Q: What can I do if one of my creditors is trying to sue me?

A: The easiest way to avoid this is to declare bankruptcy. Once you are under the protection of bankruptcy, creditors can not do anything until they have their day in bankruptcy court. However, you should never let it get to this point. You can use debt consolidation loans or debt negotiation services in order to get your debts under control long before a creditor takes the step of initiating a court action against you. It can take quite a bit before they are willing to go that route as legal fees can get very high.

Q: Will I lose my job if I have too much debt?

A: Some employers do include a clause in their employment contracts referring to personal debt. However, this is fairly rare. Unless you work in a financial services job market, you probably don't have to worry about receiving a pink slip simply because you are in over your head in debt. If your debt problems lead to your missing too much work then that might be a different story.

Q: Once I start falling behind on my debts, what actions can I expect from my creditors?

A: When you are late or miss a payment, your creditor will send you a letter or call you, or both. They will probably also charge you a late fee. They may lower your credit limit. If you continue to be late then they may even raise your interest rate. If you don't make a payment to them for a few months then they may initiate some type of court action against you. You should make every effort to never let it get this far out of control. Get into a debt consolidation program or have a debt settlement company negotiate your debts for you and by all means, get some debt counseling.

Q: Is it just me or are other people having problems with debt?

A: These days there are more and more people who have problems with their debt. You are certainly not unique. As more and more people fall into heavy debt, more and more solutions become available. If you play your cards right, you might be able to eventually gain ranks in the group of minorities who are actually completely free of debt.

Q: I do want to get out of debt but how long will it actually take?

A: Of course, how long it takes to get out of debt greatly depends on how much debt you have and how much money you make. If you sign up for a debt consolidation service then be sure to ask them how long it will take before you are completely out of the woods and free of debt. One way to get out of debt faster is to make additional payments or pay more than the minimum balance due.

Q: How much do debt consolidation services cost?

A: This varies greatly and will depend on the solution that best suits your own particular situation and needs. With most solutions, you will find that they charge an upfront fee and/or a monthly fee in order to take on your case. You can weigh this against what you would be paying if you were to simply do nothing.

Q: Should I go bankrupt?

A: Bankruptcy should be your last option. You should consider a debt consolidation loan first. If that doesn't work then try debt negotiation. If that doesn't work then you might want to consider bankruptcy. Keep in mind that a bankruptcy stays on your credit report for 10 years. You probably cannot even imagine all the ways that a bankruptcy will affect your everyday life. Get some debt counseling. A good debt counselor can tell you if other debt solutions may work for you before filing for bankruptcy.

Q: If I do file for bankruptcy, will all of my debts be discharged?

A: The bankruptcy codes vary from state to state. Only a good bankruptcy lawyer will be able to tell you the exact details. In general, most of your debts can be discharged but you may be able to exclude some if you choose to do so. You won't know for sure until you seek advice from a qualified debt counselor as well as an attorney who is trained in the laws of your jurisdiction.

Q: Will Bankruptcy cause me to lose my house?

A: Bankruptcy and foreclosure are two separate issues. Your house can only be taken away if you fail to make your mortgage payments. As with all other questions on this page, you need to seek counsel for such matters. Do not rely on anything that you read in books, magazines or the internet. You need to get quality advice from a professional.

IMPORTANT NOTE: The ideas that are offered on this website should only be looked at as personal views and suggestions. These are only ideas. For any financial situation that you may be experiencing, you should seek professional counsel.