Debt Relief for Single Moms

Single moms often find themselves getting in over their heads in debt. Most of the time the debt occurs because of a divorce and the inability to handle all of the bills on her own. In other cases it is just that her income is not enough to provide for her children and keep her head above water. There is debt relief for single moms available. Programs are made available that cater specifically to single moms.

Using Home Equity for Debt Relief

Some single moms own their homes or are given their homes in a divorce settlement. In this case, she can apply for an equity loan if there is equity available. She must not be behind in mortgage payments and must have a worthy enough credit rating. Debt relief for single moms often comes from an equity loan. Although it does add more money that will have to be paid back, the terms of equity loans are often much more manageable than other types of loans.

In some cases an equity loan can be tacked on to a mortgage or the payments can take over when the mortgage is paid in full. Mortgage lenders are more willing to work with someone that is in good standing. If payments have been made on time and the payments are current, there is usually little that a lender will look down on in regards to extending a loan or adding to it with an equity loan.

Lines of Credit for Single Moms

Lines of credit are sought out by single moms to help pay their bills and reduce their debt. This course of debt relief for single moms allows them to have funds available that can be budgeted to last for months. A line of credit is often a great idea when an actual loan cannot be obtained or she does not have equity available in her home to acquire an equity loan.

Using a line of credit to pay down debt and bring your accounts current can bring a huge sigh of relief upon approval. Although it is another bill to pay off, it gets the creditors to stop calling and reduces a single mom’s stress level. They have enough to worry about on a daily basis just providing for their children the basic necessities in life.

Grants for Debt Relief for Single Moms

There are several grant programs for debt relief for single moms. These grants do not have to ever be repaid. A single mom can apply for one of several government grant programs. These grants can only be given once in your lifetime through a single program. Many of them do have a cap as to how much can be applied for. The process begins with providing a detailed letter of need. This also needs to include a strong proposal with valid background information discussing the situation at hand causing the debt to have piled up. The bills and their balances need to be included along with your household living expenses in a detailed report. Income verification must also be included. Some programs may ask for you to submit your budget to show how you spend your income. It may seem like they are asking for your life story, but that is what they need to determine your eligibility for the grant.

Many women’s only programs offer grant opportunities as well. These grants are a little more flexible in what they ask for during the qualification process. They are specifically for debt relief for single moms to help them pay down debt accrued from emergencies with their children, re-establishing financial stability following a divorce or help in paying down non-covered medical expenses. The place to inquire about these possible grants would be the local WIC office. WIC is often given literature and requirements for special programs just for single moms since most of their clients are single moms.

Contact a Debt Settlement Company

This form of debt relief for single moms is often not thought of. A debt settlement company is often able to significantly reduce the amount of debt owed at the request of the debtor. Single moms can submit a statement of financial hardship with pertinent proof of the hardship in order for the collection agency or company owed funds in hopes of having the amount owed reduced. Wanting to settle a debt with a collection agency shows the company that you are not ignoring the debt, it says that you are just financially unable to pay all of what you owe. If it is an interest bearing collection account, they will stop the interest from piling up and usually remove the amount of interest owed completely. In many cases, only ½ to 2/3 of what is owed originally will actually be paid back when a settlement agreement is made. One of the stipulations of working with a debt settlement company is that you absolutely cannot miss a single payment. If you are going to be late, contact them as soon as you realize that you will be late so that arrangements can be made without additional penalties.

Credit Counseling for Debt Relief for Single Moms

A credit counselor can help a single mom budget her income to be able to provide housing and food for her children while paying down some of her debt. This type of debt relief for single moms helps to build her credit rating while getting out of debt at the same time. What the credit counselors do is contact your debtors. They work with the debtors to reduce the amount owed and come to a reasonable payment plan that does work into your budget. In some cases, it can be as little as just ten dollars a month. What creditors really want is for a debtor to show them that they want to pay what they owe and can do it in time. Single moms have much less money to work with most of the time. Even with child support payments coming in, it can still not be enough to get by. Credit counseling can be a very beneficial step in the right direction.

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