Debt settlement method has been instrumental in relieving many consumers from their burden of unsecured outstanding dues. For a troubled consumer who is considering this option should first learn about the nuts and bolts of this procedure. In theory this method involves negotiating with the creditors to bring down the total amount payable. In practice, it is much more than this.
Debt settlement by rule applies to only unpaid unsecured dues. These include credit card dues, unpaid medical bills, student loans, department store cards etc. lag screw hole size This is because, unlike the secured loans that have some kind of collateral attached to it that can be seized on non-payment, the unsecured loans have none. Therefore, the creditors pile up on the consumers to retrieve their money fearing bad debts, and this is where the settlement procedure steps in.
The negotiation and settlement process can be conducted either by the consumer himself or, by the professional negotiation and settlement companies. The former can handle small amounts like $5000 or, lesser. The latter can be approached for help under the following circumstances:-
When the consumer has multiple creditors to deal with.
When the outstanding amount is far more than $10000.
When there are some tax complications in the settlement process.
Reputable debt negotiation companies, when approached, provide the consumers with expert professional negotiators who get the best deal in favor of the latter. Through the debt settlement method, people have been able to reduce their arrears by 50% or, more. Elimination to an extent of 80% has also been witnessed.
The negotiation companies also chalk out a repayment plan that is suitable for both the debtors and the creditors. When a settlement amount is reached and agreed upon, the debtor is expected to make a lump sum payment, clear the due and close the account. If the consumer has no source of lump sum payment but has a regular income source, then the option of paying monthly installments can also be available.
It is true that the negotiation and settlement procedure is best handled by the professional companies, but unfortunately, all such companies and agencies are not legitimate. To locate reputable debt negotiation companies one should refer to the list of companies under the Better Business Bureau. Going through the relief networks is also a sensible option.
It is also considered wise to consult people who have been benefited by the same negotiation company. Once the authenticity of the company is ascertained, the consumers can fall back and relax. Their outstanding amounts are as good as gone. Consumers can then concentrate on ways to increase their income and improve their financial stability.
Debt settlement is a legitimate alternative to filing bankruptcy. Consumers must be experiencing a legitimate financial hardship and have at least $10k in unsecured debt to qualify for most programs. Check out the link below to locate legitimate debt settlement companies in your area for a free consultation.