Debt Settlement

Debt settlement is a debt relief process for settling your debts for less than what you currently owe. It involves negotiating with the creditors to reduce the amount you owe to them.  Debt settlement helps you to save a huge amount of money by negotiating with the creditors.  You will have to make monthly payments to save the settlement amount. Once you have enough money, you can repay your creditors the agreed amount.

Debt settlement is an alternative to bankruptcy. It’s more flexible and affordable as compared to credit counseling. You don’t have to make minimum monthly payments to your creditors. Instead, you will keep aside a predetermined amount that will be used for paying the debts

FAQ'S

What type of debts can be settled?
The debts that can be settled include credit card debt, medical bills, department store cards, signature loans, and other types of unsecured debts.
Will debt settlement garnish my wages?
It’s a very rare situation that your wages might be garnished. Also, without an advance warning your ages cannot be garnished. If a creditor wishes to garnish your wages, he will have to bring a lawsuit, obtain judgment and authorization.
What kind of debts cannot be entered into a debt settlement program?
Debts involving collateral cannot be settled through a debt settlement program. These debts include home loans, second or third mortgages, equity lines of credit, auto loans or other financing contracts that are tied to a security that the creditor may repossess if you fail to pay your debts. Federal student loans are also not included in the program.
How is debt settlement different from credit counseling?
Both are different approaches to resolve debts. In credit counseling, you will have to pay all your debt balances including the interest and fees. Whereas, debt settlement involves paying off only your debt load. Your debts can be settled faster with debt settlement as compared to credit counseling.

How does debt settlement work?

Debt negotiation is a key element of the debt settlement process. This is when your creditors agree to settle your debts for a less. Most of the creditors agree to settle for less than the amount owed to them.

You can negotiate with the creditors on your own if you possess the necessary skills. However, negotiating with the creditors is a time consuming process. That’s why most people hire debt settlement companies for help. The professional debt negotiators negotiate with the creditors in an effective and efficient way, thus reducing your stress to a great extent.

Once the creditors agree to settle for a less and the client approves the settlement, the payment process shall be initiated. Some settlements may involve lump sum payment while the other ones may be more structured ones, involving multiple payments. On the completion of the agreement, the debt resolution services on that particular debt shall be complete.

How does debt settlement work

Is Debt Settlement a right option

Is Debt Settlement a right option?

Debt settlement programs are often considered as one of the best ways for reducing your debts. If your unsecured debts amount to $7500 or more, debt settlement may be the right choice for you.

Debt settlement is not the right solution for the individuals who aim to maintain a high credit score. If you want to maintain a high credit score, debt consolidation is a better option that you might consider. To get the best results, it’s a good idea to hire an experienced debt relief company for settlement of your debts.  Debt relief companies get you the debt settlement program after evaluating your financial situation.

Debt advice provide expert debt settlement services for settling your obligations affordably. We will connect you with expert negotiators who shall negotiate with the creditors. Our debt settlement program is tailored to fit your individual needs and negotiate on the arrangement that brings you the best outcome.

Pros of Debt Settlement

resolve debts

Debt settlement works to reduce the principal balance you owe rather than moving high interest rate debt to lower ones. The main purpose is to settle your debts quickly.

You have to deposit your pre determined monthly payments into a special account. This deposit is generally less than the payments on debt consolidation loans or credit cards. It’s also less than the monthly payments you make in DMP.
Debt settlement is flexible and less costly in comparison to other alternatives such as consumer credit counseling or loan.
Debt settlement programs offer better repayment terms as compared to bankruptcy. Additionally, debt settlement helps people in getting out of debts without leaving a permanent record on their credit report.
The best debt settlement companies encourage clients to start using a budget and adopt best finance related practices into their lives. Also, people learn better money management by making regular deposits into the special debt settlement funds.

Things To Consider

Debt settlement is a fast and effective way of reducing your debts. However, there are certain drawbacks associated with this debt relief option. The foremost concern is its effect on credit score. In the initial stages, there might be a drop in your credit score. If there is no progress or you have maxed out on your accounts, your credit score may not be high. Debt settlement may adversely affect your credit score in the short run. But, in the long run, it may put you in a better financial situation. Your creditors may continue to contact you for the payments. They might also threaten to take a legal action against you.

If you’re considering debt settlement, we are always at your side to help you settle your debts at a reduced cost.