Debt Relief Loan

Debt Relief Loan

A debt relief is taken resort by a person when he is unable to bear the debt pressure which he has accumulated. A debt relief program comprises of debt settlement, credit counselling and debt consolidation. All of these programs lead to the paying off the debt by the debtor with an amount which is agreeable by both the creditor and the debtor. Sometimes the debtor takes help of a debt relief loan to repay back the initial loan. A debt relief loan is nothing but a prime part of a debt relief program.

This loan is announced by the government of any state when the government sees that due to some natural calamity or due to recession or any other problem the people are not being able to repay back the loan amount taken by them. It totally depends upon the discretion of the government to start the relief loan. This loan is offered at a very low rate of interest, for a limited period and helps the debtor to pay off the loan with high interest rate, thus helping the person to become debt free.

This loan is not only helpful for the debtor but for the creditor as well. It helps the creditor to recover the loans given. Due to recession when people are not able to pay back the loan then it becomes mandatory for the creditor to take steps which will not only help to recover debts but also make the debtor in a comfortable financial position. Debt relief loan is one such step taken in this direction which has helped and will help the creditors to recover almost seventy –five percent of the loan amounts. Although this has resulted in non recovery of some percentage of the loan yet people resort to this scheme to help the debtors.

Debt relief programs are in vogue in these as if we see the economy mostly people are caught up in the trap of debt. Due to hectic work schedules they do not have time to think about solutions to pay back the loan. Thus they take help of debt relief loan to pay off the outstanding loan amount and stay away from paying high interest rates.