What Are the Best Government Debt Relief Programs?

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When it comes to relief for your mounting and worrisome debt, you’re considering all options. You hear the government offers forms of help, but you’re unsure whether any of those match your circumstances. So, what are the best government debt relief programs? Read on.

Is there a Government Program for Credit Card Debt?

Let’s get this out of the way. In short: no. No government effort can get you off the hook for your credit card obligations. Now, there is bankruptcy, which is a strategy the government provides. However, this approach is complicated and fraught: depending on whether you choose Chapter 7 or 13, the filing may stay on your credit report for seven to 10 years, and you may have to relinquish some of your assets.

You also may want to consider nonprofit credit counseling, which is sponsored by credit card issuers. These agencies can help reduce your debt through education, budgeting, and other resources that can help you lower and, at length, eliminate your debt. If your woes are acute, you may need debt settlement, which allows you to pay just a portion of your debt in exchange for a one-time payment in full. For that, we recommend Freedom Debt Relief.

Government Help with Taxes

If you’re delinquent on your income taxes, the Internal Revenue Service has established one of the best government debt relief programs in Fresh Start, which facilitates tax repayment. The IRS Fresh Start Program greases the skids for what’s called an Installment Agreement, a debt consolidation program that aims to help you repay years of taxes on which you’re behind. Offer in Compromise – the government’s tax debt settlement program – is also part of Fresh Start.

Government Help with Income-Based Student Loan Repayment

Believe it or not, the government doesn’t want you saddled with student loan debt. Why? Because if you’re struggling in that area, you can’t afford to buy houses or make other large purchases that help stimulate the economy. Thus, the government offers a variety of programs that can lower your monthly payments to something you can afford. That’s right: you can get help based on your earnings and family size.

Government Student Loan Disability Discharge

Individuals who have a chronic disability may be eligible for what’s called a Total and Permanent Disability Discharge. You may have to jump through hoops, qualification-wise, but if you can meet the conditions, your whole student loan balance could be forgiven.

Government Public Service Loan Forgiveness

Here, firefighters, first responders, nurses, or emergency medical technicians who are employed by a public hospital, may qualify for public service loan forgiveness. If you can hang with the 10-year program, and execute all required steps, the government may forgive your student loan balance.

Government Help with Medical and Other Bills

No, there’s no blanket program for help with personal debt. Still, there are federal and state programs that can assist with medical bills or other financial hardship such as an inability to buy food or pay for utilities or prescriptions. You may also want to check out the government’s MedlinePlus site for info and programs about medical debt.

As you can see, the government does offer debt relief programs, although most of them have a rather limited scope. But perhaps you’re surprised by some of the programs since many aren’t widely publicized. Look them over carefully.

If your issues have more to do with credit card debt, you may want to mull debt consolidation or debt settlement. Just do your research — and choose wisely.

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