Debt settlement

Closer Approach To Debt Settlement

After the recent financial upheaval, almost all individuals and families are not being able to manage their finances and are incessantly falling into debt. When these people are drowning under the sea of outstanding debt and looking for a way to come out of it, they can pursue debt settlement for clearing their debt. But before considering the option to wipe off the debt with debt settlement, you must gather some necessary information about it.

What is debt settlement?

Debt settlement, also known as debt arbitration or debt counseling is a process that allows the debtors to negotiate with creditors in order to reduce the pay off amount as well as the interest rate so that the debt becomes affordable to pay. One can negotiate the debt settlement with the creditor on his own or can hire the services of a debt settlement company.

How does a debt settlement company work?

A debt settlement company negotiates with creditors and reduces the pay off amount on your behalf. They also waive off the interest rate and charge-offs to fix your debt at an affordable repayment amount. A debt settlement company can reduce the principal amount of debt by upto 40% to 60% with their excellent negotiating skills.

However, before pursuing debt settlement or hiring the services of a settlement company, you must consider the advantages and disadvantages associated with it.

Advantages of debt settlement:

The biggest advantage of debt settlement is that it relieves you from your overwhelming debt and from the annoying creditor calls.

Another primary advantage is it helps you save hundreds and thousands of dollars by negotiating with creditors and reducing debt by upto 40% to 60%. However, the amount you can save depends on how well you or your settlement company negotiates with creditors. (more…)

Is Bankruptcy the Only Way to Get a Fresh Start?

A lot of people assume that bankruptcy is the only way to get a clean start. In fact, for many years, it was the only way to really get a clean and fresh start. Yet there are some serious pitfalls of bankruptcy that you will need to think about.

First and foremost, you will have permanent damage to your credit report. For the next 10 years, you will have to deal with the fact that a bankruptcy is on your credit report. In addition, if you were to get into trouble financially again, you would not be able to file bankruptcy. Why do you think that bankruptcy filers get pelted with credit offers so quickly? It’s not because lenders suddenly love you, it’s because they realize that you cannot file for bankruptcy again for a long, long time.

If you are applying for jobs in sensitive industries, a bankruptcy can completely disqualify you for the position — even if you have a great career history! You could be the top applicant, but if you have that bankruptcy hanging over your head, your future employers might feel that you can’t handle pressure or money or even risk. This is not a good category to find yourself in at all.

If you think that your bankruptcy will be kept a secret, you might want to think again: bankruptcy is actually public knowledge. This means that anyone that’s curious enough to look into you will know that you filed bankruptcy. Even if you’re just trying to date casually, be careful: today’s dating singles are looking into people more than ever before. As one woman put it, “You have to know where all the bones are buried, because if you get married they become your bones too!”

There has to be something that you can do if you want to avoid bankruptcy. Thankfully, there is: you can go with debt consolidation or debt settlement. Let’s cover both of those here quickly.

Debt Consolidation

This usually comes in two different flavors: debt consolidation agreements, and debt consolidation loans. An agreement is simply what your creditors will agree to that lets you combine everything into one monthly payment, and then the payment gets disbursed to different lenders. This can be good if you can get all of your creditors to cooperate with it. If you’re not good at negotiation, you can have another company handle this for you. They have the expertise to make sure that you get the results you’re looking for.

On the other hand, you also have debt consolidation loans. These are great loans that will basically let you pay off all of your debts, and then turn around and pay the debt consolidation loan. You might think, “Gosh, no more debt!” but there are some benefits to this track as well. For starters, the monthly payment will be lower because you’re not paying high interest rates. This can be something very promising, and you should definitely think about it.

Debt Settlement

This is a good option if you’re trying to get some relief. If you have steady income but you just need a little help, an outside company can help you settle part or all of your debts. You would then owe less money, which means you could put out more money to bring all of your debts down in short time.

Which option is best? It just depends on the money you have coming in, as well as the type of debts that you have. If you find that you just can’t get relief from any of these other options, you might want to stop and actually talk with a bankruptcy attorney to see your next steps. Your future is too important to leave it to chance!

Debt Settlement: Five Things You Should Avoid

Debt settlement is a good remedy to eliminate your debts, but not everyone is qualified to avail of this option.  This is actually a better debt solution than filing for bankruptcy, but if you want to give it a try, you have to avoid the five things in order for you not to get caught in a bigger and more serious financial problem, and they are as follows:

1.    Debt settlement companies with exorbitant fees.  You have to watch out for debt settlement companies that collect excessive fees for their services.  A good company usually base their fees on the total amount of the debts of their clients.  For you to land on a good debt settlement company, you have to really do first some research.

2.    Not jotting down debt settlement conversations.   There will be times when you have to communicate with your creditors through phone.  For you to be sure that everything that will be agreed upon will be followed, you have to write down every single detail.  After which, make a copy and send it to whomever you talked to.  This way, your creditors will know that you are serious with debt negotiation.

3.    Settling your fees before signing a contract. Many people tend to forget that they should sign a contract first before paying anything to a debt settlement company.  This is a risky move as the company may not fulfil its promises and that the results may be unsatisfying.  Do not rely on verbal agreements alone.  It is important to put all your agreements into writing and make sure you review them thoroughly before signing it and before making a payment.

4.    Approaching a non-trustworthy debt settlement company. Before choosing a settlement company and if you’re going to do the settlement on your own, you first have to check its records with the Better Business Bureau just to make sure that you’ll be dealing with a trustworthy company that can help you resolve your debt problems.

5.    Immediately agreeing on proposals. Agreeing on proposals so quickly will give your creditors an impression that you are willing to pay any amount.  As much as possible, take your time in making decisions and do not always say yes to every proposal they lay down in front of you.  If you want to know how you can possibly get a good debt settlement deal, you may join forums or discussion groups and get inputs on what you should do.

Different Means to Eliminate Your Debts

You can lose your sanity just by thinking of all your debts and how you could eliminate them.  It is really so hard to recover and become financially stable if your debts are continually increasing day by day.  If you are drowning in debts and you want to get the credit collectors out of the picture, maybe it’s time for you to go for debt settlement.

You’re not the only person having this kind of financial problem.  Just believe that you can get out from this situation since there still a chance for you to achieve financial freedom through the debt settlement process.  Debt settlement is also often called debt negotiation, and this has become one of the most popular debt solutions.

In a debt settlement, you try to reduce your debts by way of negotiating with your creditors.  If you are successful with the process, you can lower your debts by 50%, which means that you will be able to clear out your debts much faster than expected. Debt settlement became popular since the start of the global financial crisis where the unemployment rate as well as the inflation rate has hugely increased.  Other people who haven’t heard of debt settlement didn’t have a choice but to file for bankruptcy.  Bankruptcy is another debt solution, but doesn’t have a good effect like years of bad credit rating.

Debt settlement can be carried out personally or you can ask for the help of a debt settlement company.  Choosing to perform debt settlement on your own can just complicate your problem with your debts if you are not well-versed with its processes.  If you want to at least be sure to get a good result, you should find approaching debt settlement companies a much better option, besides, credit institutions and banks prefer dealing with them rather than with individuals.  Also, debt settlement companies have more chances of getting you a better deal.  Personal negotiation is not really recommended as it has several downsides, and one of them is the rejection of request.

In debt settlement, there are so many documents that are to be accomplished and this can be very exhausting.  So, if you prefer personal negotiation, find it necessary to know all the paperworks that your need to accomplish.  Debt settlement companies are highly experienced with matters like this, and this means that they can fast track the process of negotiation with a positive outcome.