If you don't repair bad debt with consolidation, you will probably stay mired in debt for decades.
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Types of Debt

In order to understand how to repair bad debt, you first must understand the different types of debt. Here we'll explain the two main types of debt: unsecured and secured.

Unsecured Debt

The only kind of debt that qualifies for a repair bad debt program is unsecured debt. Unsecured debt refers to a debt that is not linked to a physical piece of property, such as a car, boat, house, etc. With unsecured debt, creditors are much more willing to negotiate interest rates because they can't repossess any property. You will need at least $5,000 of unsecured debt to qualify to repair bad debt. Here are some common types of unsecured debt:

  • Credit card debt
  • Personal loans without collateral
  • Phone or utility bills where line has already been disconnected
  • Student loans
  • Medical bills
  • Debt consolidation loans not tied to a house

Secured Debt

Secured debt is a loan that is attached to a piece of collateral. With secured debt, your lender owns the property attached to the loan until you pay the loan back in full. In other words, if you fall behind on payments, the lender could legally repossess your property. This is why unsecured debt does not qualify to repair bad debt through our services. Creditors are not very cooperative in reducing interest rates when they could just seize your property instead. If you are struggling with secured debt, you cannot repair bad debt with debt consolidation. You should instead consult a specialist in this area. Here are some common examples of secured debt:

  • Mortgages
  • Personal loans with collateral
  • Car loans
  • IRS tax liens
The only kind of debt that qualifies for a repair bad debt program is unsecured debt.