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With an unemployment rate of 6.1%, Missouri is below the national average for unemployed residents. Unfortunately, this doesn’t apply to credit card debt.

On average, Missouri residents hold over $6200 in credit card debt. Although this number is above the national average, Missouri residents have an average credit score of over 720, giving them good credit.

But even though the average Missouri resident has solid employment and a strong credit score, they’re not paying off the money that they borrow. This may be because they’re not making enough money to effectively pay back money a creditor has lent them.

If you’re one of the many Missouri residents struggling to get out of debt, you may need some help. Using a debt relief program may be the assistance you need to finally get out of debt.

What are Missouri Debt Relief Programs?

Debt relief programs are designed to help individuals sinking in debt finally get a breath. A debt relief program allows the creditor and debtor to renegotiate the terms of the loan so that the debtor has a better chance to pay it off.

There are a few different types of debt relief. Here are some of the most common programs and a brief explanation of how they may be able to help you:

  • Debt Consolidation: Debt consolidation is the best form of relief for individuals with good credit scores. Through debt consolidation, you’re able to apply for a new loan that will cover the cost of your smaller loans. You can use your money from the new loan to close out debts with high interest rates, saving you money each month.
  • Debt Settlement: If you’re frequently missing payments on your debt and your credit score has already suffered because of it, you need to close out that debt before it can do any more damage to your credit score. Debt settlement allows you to offer a settlement amount to a creditor, typically much lower than the overall payment due. If your creditor agrees, your debt will be closed permanently.
  • Debt Refinancing: Refinancing a loan is beneficial to individuals with only one debt they’re struggling to pay down. If a debt has a high interest rate or the monthly minimums are too high, you can refinance the loan to have terms you can better comply with. Refinancing does not reduce the amount you pay each month, just makes it easier for you to meet your payments and actually make a dent in your principle.

The debt relief program you select will depend on the kind of debt you have, how much you’re able to pay towards the debt, and how important your credit score is to you. Both debt refinancing and debt consolidation will do very little to your credit score, but you need to have strong credit to quality. Debt settlement can seriously hurt your credit score, but if you’re unable to make your minimum payments, you may already have poor credit.

Typically you can only use debt relief programs on unsecured debt, such as credit card debt, medical bills, or certain kinds of loans.

Missouri Rules and Regulations for Debt Relief and Collection

If getting hounded by a debt collector is pushing you towards a debt relief program, it is important to understand what the Missouri rules and regulations surrounding debt collection are. A debt must be valid if you are going to be held accountable for repaying it.

A debt is not considered valid if it is outside the statute of limitations. The statute of limitations for collecting a debt in the state of Missouri is either five or ten years. For oral agreements and open accounts, the statute of limitations is only five years. For promissory notes and written contracts, the statute of limitations is ten years.

The clock for the statute of limitations begins when the debt goes into default – not when the debt was opened. For standard debts with a monthly payment, a debt goes into default about one month after the last monthly payment. You must not have made any payments during the time period, or the statute of limitations clock would restart.

Finally, debt collectors must follow the rules and regulations laid out by the Fair Debt Collection Practices Act. This states that debt collectors cannot use unfair, unethical, or deceitful practices when attempting to collect funds from a debtor. If those practices are used, they may be legally blocked from collecting money from the debtor.

Be sure to fully understand your options before entering into a debt relief program in Missouri. Talking with a professional can help you understand what debt relief program will fit your situation best.