Debt mediation can take several forms that may be of use to consumers who find themselves over-extended on loan and credit card obligations.  In some cases, debt mediation can relieve a consumer of a specified percentage of their debt, leaving them responsible for paying, for example, 70% of an obligation rather than 100% of the money borrowed.  This strategy can actually be advantageous to the creditor as well as the debtor; by taking a negotiated amount, the lender receives an assurance that at least that portion of the debt will in fact be paid.  The alternative without debt mediation might be no payment at all.

Consumers may well question, therefore, why they should engage in debt or commercial mediation rather than simply abandon their debts.  The answer is that abandoning debts does great damage to a consumer's credit history, making loans unavailable for many years to come.  In addition, employers and landlordsroutinely check credit histories of applicants.  Letting a bankruptcy occur can mean great difficulties obtaining both a job and a place to live.

Other Debt Mediation Alternatives

Another form of debt mediation is a revised payment schedule or interest rate.  In these scenarios, consumers still pay the full amount owed, but they are given longer terms in which to do so and sometimes a lower interest rate.  Both of these lower the average monthly payment and make it feasible for consumers to meet their obligations.

Learn more about Mediation or find a Mediation Attorney in the National Mediation Directory.