Tag Archives: debt settlement
Benefits And Drawbacks Of Credit Card Debt Negotiation
Do you think you’re overwhelmed by the level of unsecured debt you have now? There are lots of individuals in an identical situation to yours. For all those people with debt out there, there are many programs available that can help with debts. None turn out to be “great” or “amazing”, they all have their pitfalls and negative aspects. But, out of all the choices, unsecured debt settlement is the one that has the possibility to help the the majority of people.
Here are 5 ideas that you need to give some thought to:
1. You’ll be able to greatly reduce the amount of credit card debt you presently owe with a debt settlement program. They are not permitted to quote a specific amount to you (such as “you can save 75%”), however it is a drastic number. A solid credit card debt settlement company is likely to have prior relationships with creditors and know just how much they could knock off of your debt. I’d personally pick a company who gets paid in relation to the amount of money they can help you save.
2. You don’t need any assets with a debt settlement program. Compared with debt consolidation, you do not need to acquire a loan to blend all your financial obligations together into one payment. An example of this could be acquiring a second on your residence to pay off your debts. You have taken the money you owe and produced an additional debt with this approach.
3. You are able to answer your phone once again! You can forget collection calls. Tired of screening your calls to protect yourself from debt collectors? An experienced debt settlement organization will either halt those phone calls or take them over for you. Not a single thing is more irritating than getting those calls all day long… Some collection agencies do not following the rules and definately will still call. Make sure you advise your specialist of this and follow the necessary steps to stop it.
4. A lot of debt settlement participants usually take 2 or maybe 3 years in order to complete. This is not normally the case with debt consolidation loans, (which can go on for 5+ years). In the debt settlement programs your debt gets cut down tremendously, making it easier so that you can cope with an agreed upon plan you can set up with your counselor that will work for you in your own personal situation.
5. You’ll be able to rest at night knowing that you do have a solid financial plan and you’ll soon be out of debt.
The Drawbacks
Yes, of there are downsides. The first is that your credit score will be affected. Nevertheless, if you are in this much credit card debt, it almost certainly will be anyhow, if it’s not already. Using a debt settlement program this should only be short term. As soon as your plan is in place, it won’t take so long to undo that damage, particularly since you opted to adhere to a program to deal with your debt. It’s not nearly as bad as personal bankruptcy or even a consolidation loan that some banks look at as the same a bankruptcy.
You may need to take a look at tax situation. When you debts get reduced you could be held accountable for “money earned or gifted” to you. However, there are hardship laws in effect so that, fortunately, this has not been a predicament for too many. Check with your counselor concerning this also.
{ You might still get calls from those slimy collectors that will not believe you’re out of debt. Your counselor can also tell you how to deal with them, of course, if necessary, sue them.
|- It’s possible to still get calls coming from irritating creditors, however your counselor is able to explain to you how to deal with them and if necessary you can even take legal action against them to stop the harassing phone calls.
For additional information about credit card debt settlement and corporations that can help you get rid of your credit card debt, just have a look at the links below.
Debt Settlement, the Better Debt Relief Approach
In our struggling economy, indebted Americans are looking for a way to relieve themselves of financial and emotional stress. Many debt relief options have become available. Amongst them are the popular three: debt settlement, debt consolidation, and credit counseling. With these services being promoted so heavily, how can one choose and then not regret their decision later?
To make the proper choice, we must view these options from both good and bad perspectives, as well as individual situations.
Let’s start with the bad. Credit counseling and debt consolidation appear on your credit score stating that you are “currently enrolled in debt counseling program” which poorly reflects on you when applying for new credit. Debt settlement lowers your credit score because it requires a four month delinquency to negotiate. The accounts enrolled in debt settlement are closed (questionably bad as it can save many from repeating their mistake).
Regarding the benefits, credit counseling and debt consolidation programs allow you to be debt free within five years with a lowered interest rate (approximately 5%) saving you a good deal of money over time with the monthly payments being put into one single payment and slightly lowered. They also allow you to keep your accounts open (also questionable). Debt settlement allows you to be debt free within 12-36 months, while paying 55% of your total debt (in most cases) and 0% interest, resulting in savings of more than 60% because of no interest accrual. The payment is also consolidated in one single monthly program payment while being lowered substantially (by up to three times less).
Although debt settlement lowers your credit score initially, the purpose and goal is to get you debt free as soon as possible, and help you start rebuilding your credit score immediately – by staying on time with secured loans like mortgages and auto payments (which reflect the most on your credit score).
Most importantly, always remember to view a company’s Better Business Bureau profile for a high rating and a powerful track record. You can never be too careful about who you’re trusting your finances with!