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Debt settlement involves negotiating with a creditor to eliminate a percentage of your debt at an agreed upon settlement amount. Debt settlement companies traditionally employ various negotiation strategies to help settle your debts and typically eliminate between 30-60% of your original balances. Our firm currently averages 60% off the current debt amount.
The most important part of debt settlement is to complete the settlement process with your creditors and or collection agencies. During the settlement process, you will make a monthly deposit into a "settlement account" that will eventually be used for your debt repayment. As funds begin to accumulate in the account, the debt settlement company will start to negotiate with your creditors. Once a debt settlement offer has been agreed upon, you will need to send that amount, directly from your "settlement account", to the creditor. Once the payment has been made, that debt is considered settled in full. You will no longer owe anything on that debt and the account will be closed.
Why do Creditors work with Debt Settlement Firms
Creditors know that roughly 30% of the 1.5 million bankruptcies that occurred last year were on debt that was reasonably current and should NOT have taken place. Traditionally, people survive by borrowing from one creditor to pay another. However, this process eventually fails when consumers run out of available credit lines and find themselves unable to make their minimum monthly payments. Debt Settlement monthly payments are slightly below the minimum payments you would make to your creditor.
If a consumer files for bankruptcy, it is very likely that the creditor will receive nothing of the balance that is owed to them. Therefore, a creditor is better off negotiating with a debt settlement company. Our debt settlement company works with customers that have legitimate financial problems and honestly need assistance or has some type of hardship.
The debt settlement process usually takes between 24 to 36 months depending on how much you can pay each month and how well the debt settlement company can negotiate. Besides the obvious benefit of debt settlement, another benefit is the help with creditor harassment. Debt settlement companies normally contact all your creditors and inform them that you are working with a debt settlement company and that you are now being represented. This is very important in that it helps minimize or eliminate creditor calls. The standard practice is to direct all communication to the debt settlement company that you are working with. However, it is important to remain cognizant of the fact that original creditors can still contact you legally, but most creditors will comply with your request to have your Debt Settlement company receive all the communication.
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Get FREE consultation for the BEST debt settlment. Fill our web consultation form or call us toll free (888) 767-9117 NOW.
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