Debt Solutions

As you consider your approach to reducing or eliminating your credit card debt, it is important to know that there are several possible solutions that could be utilized to accomplish your goal. We advise that you review the advantages and disadvantages of each option in order to decide which would be best for your own personal situation, and future financial goals. 

Power Payment Method

A self-administered, systematic way to pay down debt by paying all minimum payments but paying the most possible on the highest interest account, once this account is paid off, that payment gets applied to the next highest interest account and so on and so forth until the debt is paid off in full. (snowball effect)

Debt Management Plan (DMP)

A structured repayment plan set up and administered by a designated third-party agency. Monthly deposits are made to the Agency, and the funds are then disbursed out to the creditors. Serves a dual role of helping a consumer get their debts paid while the creditors receive the money owed.

Consolidation Loan

An unsecured loan extended by a bank or credit union that is used to pay off all outstanding credit card debt. Be wary of Finance companies, they often charge high interest rates. 

**It is not advised that you take a loan from your retirement to pay off credit card debt due to the penalties that are imposed

Home Equity Loan

A secured loan that is used to pay off all outstanding credit card debt. 

**Reverse mortgage- An arrangement for those individuals 62 and older in which a homeowner borrows equity in his/her home and receives regular monthly payments or a lump sum amount (tax-free) from the lender.

Negotiated Debt Settlement

Negotiating with creditors to settle debts for less than the full balance owed. 

**Be wary of Debt Settlement Companies – they are for profit and charge exorbitant fees for a process you can administer on your own. Many of these companies are scams.


A legal proceeding filed in the U.S. Bankruptcy Court. A Chapter 7 permits a discharge/ liquidation of the total debt obligation and a Chapter 13 involves repayment of some or all of the debt obligation. An attorney must perform a means test to see which chapter an individual is eligible for. The bankruptcy laws are intended to allow an honest but unfortunate debtor an opportunity to get a fresh start. Contact a bankruptcy attorney regarding your options.