Need Help In Debt Management Plan(MDP)
6 months ago
I need help, if possible please help me to overcome from this. I hope you will understand my situation and will help me to overcome from this situation.
In the past 2.5 year i did many mistakes to sustain my business. To keep the business running I invested all my savings and i took many loans and used my credit cards to the fullest. I tried my best to make it profitable and tried very hard.
I took many loans just to give salary and didn’t took a single penny for my own personal use. But now I m in a debt trap and unable to pay the monthly EMI on time. And that’s why recovery agents are harassing me and I unable to work properly. So I request you to please help me to recover from this situation.
Currently I have around 12.5 lakh of loans. All are from Credit cards and personal loans. After some research i found out that I can opt-in for DMP(Debt Management Plan) through a credit counsellor and repay all these loans in a affordable EMI.
Anyone please help me to recover from this? I m ready to pay all these but with a affordable EMI and want to start again freshly.
I hope you will understand my situation and guide me to overcome from this.
Lenders are not legally obliged to settle a debt lowering your outstanding debt, but because they want to protect their bottom line, they may agree to a debt settlement to avoid further financial loss. You can try to negotiate a debt settlement on your own if your pocket permits to repay entire outstanding at a time for one time settlement of dues, but sometimes it's typically done through third parties like debt relief companies, which you may hire to negotiate the settlement matter with the lender on your behalf. With this method, you will make payments to the debt settlement company rather than your creditors/lenders, along with any fees. Debt settlement is an agreement between a lender and a borrower in which the borrower repays a portion of a loan balance and the lender forgives the remainder. You may consider starting the negotiation by offering to pay 25% or 30% of your outstanding balance in return for forgiveness on the rest. But, it may be noted that while there are legitimate debt relief/settlement companies, there are also many scam operations. So, if you're considering one, the Consumer Financial Protection Bureau(CFPB) suggests for contacting your state attorney general's office and local consumer protection agency to ask if they have any consumer complaints on file about that company. Some states require that debt settlement companies be licensed, which may provide some added protection. Although a debt settlement can offload some of your financial crisis, there are also few potential risks and downsides to consider. First, a debt settlement will affect your credit score. That will make it more difficult for you to get credit or good interest rates in the future. Another potential drawback is that when you settle debt, you could face tax consequences. Finally, when you settle a debt with a credit card company, your account is closed once the settlement is complete. So you could potentially have no credit facility to use a credit card further owing to your poor credit score. Further, a quick counseling session with a certified credit counselor can help you to discover your options and choose the right path forward
As you mentioned, a Debt Management Plan (DMP) could be a suitable option. A credit counselor can help you assess your financial situation, create a budget, and negotiate with your creditors for more affordable repayment terms. They can also help you set up a DMP if it's suitable for your situation. In India, there are legal provisions and guidelines that protect consumers from harassment by recovery agents. You have the right to be treated fairly and respectfully. Recovery agents must follow the rules laid down by the Reserve Bank of India (RBI). If they are harassing you, document their actions and report them to the RBI and the local police. In extreme cases where all other options fail, you can consider filing for bankruptcy. In India, the Insolvency and Bankruptcy Code (IBC) governs bankruptcy proceedings.
Repayment of loans and credit cards
Multiple unsecured loan defaults
Unfreeze
For bank loan
Bankruptcy and Debt
