Your credit card bills are stacking up and for whatever reason you don't have the means to pay the debt. You definitely have choices when you are in this predicament. You can choose to do nothing and hope for the best. Unfortunately, this can cause you a bunch of headaches because creditors will pursue you with unrelenting fervor. When the creditor gives up, they will generally pass the account over to a collection agency. Their pursuit is even more relentless because in most cases they have purchased your account. If you choose to do nothing, prepare yourself for many sleepless nights. There are alternatives that are less stressful and that can get you out of debt.
A better alternative to doing nothing about debt is one that benefits both you and your creditors. Negotiating a debt settlement plan with your creditors can help you dig yourself out of the hole you're in. How a debt settlement works is simple. You inform the creditor that you want to pay the debt, telling them exactly how much you can afford. The creditor accepts or rejects your payment plans and you begin making payment. If you have debt of more than $5, 000 you may think it would take years to pay off the debt. Actually, the amount of your debt probably includes late and over-the-limit fees, and other charges. Creditors will often work with you and may reduce or completely eliminate these charges. This can significantly lower your balance. If your account is associated with a high interest rate, it is possible that the creditor may also lower this amount for you.
You have choices when you consider a debt settlement. There are companies in just about every major city that offer debt settlement services. These companies do all the legwork for you. You sit back and save your money and when instructed to, begin making payments towards your debt. While you are saving your money the debt settlement company negotiates the plans for you. Independent companies that perform debt settlement services don't do so for their good health. They will generally charge you an initiation fee. Depending on the company, your monthly settlement payment may include a fee as well. Be prepared to do some research if you choose to work with one of these companies. There have been reports of scams.
A more secure and less expensive method for debt settlement is to go through a consumer credit counseling agency. Of these, Consumer Credit Counseling Service (CCCS) is the most well known. This is a non-profit agency whose main focus is to help people get out of debt. CCCS offers a Debt Management Program (DPM) that works similar to a debt settlement. Depending on the office in your area, you may or may not have to pay a fee. If you do it is typically very insignificant. An advantage of using CCCS is that they will help educate you about financial matters.
An even cheaper way to initiate a debt settlement is to contact your creditors yourself. Many people are unaware that they can negotiate with their creditors. You don't have to seek professional assistance. There are a few ideas you want to keep in mind if you decide to proceed on your own. Make sure that the payment you agree to is what you can actually afford. Once you and the creditor agree on a debt settlement plan, it is a good idea to get the terms in writing. Many creditors will generate a letter detailing the agreement, but if they don't', simply type of the terms and send it to them certified mail, requesting their signature.
Sound good so far? Before you start envisioning yourself debt free, it's a good idea to consider the pros and cons of debt settlement. On the positive side, you don't have to worry about the annoying calls from creditors. Since you agree to a specific plan of action for your account they have no reason to call you. Another good point for debt settlement is that the terms are based on what you are able to pay. You design a budget and determine what you can afford. This also relieves some stress since you're not stretching to pay your bills.
There are some disadvantages to debt settlement. Although you establish a payment plan with creditors, there is the possibility that they will report your account as "Not Paid As Agreed," which is viewed as negative information on your credit report. This information can remain on your credit report as long as seven years. While you are making payments in the plan you should not use your credit cards or obtain additional credit. In addition, depending on your debt you may be in the plan for up to two years.
James Duggan is an author,internet marketer and membership consultant for Financial Freedom Society Inc. http://www.ffsi-rq.com For more information on debt consolidation,personal finance,debt and credit card help visit: http://www.fix-a-debt.com
Recently passed by Congress, the Bankruptcy Abuse Prevention and Consumer... Read More
Credit that cannot be managed or is not being repaid... Read More
You cannot understand the importance of being a homeowner until... Read More
Credit counseling is a valuable service for consumers who have... Read More
If you are in debt, you have several options available... Read More
If you find yourself having to make too many payments... Read More
Overcoming the stigma of being in dept, grow in self-confidence... Read More
Jane was a fun loving girl from Birmingham, you could... Read More
If your debt is becoming difficult to get on top... Read More
Borrowing money against your credit cards has always been among... Read More
There are many benefits in choosing a Debt Consolidation Loan,... Read More
Debt Consolidation of Different LoansDebt consolidation refers to the restructuring... Read More
Consolidation loans can be very useful in a number of... Read More
Debt consolidation has become big business in this country over... Read More
Should I consolidate my college loans or not?1. Still in... Read More
Consumers looking for a way out of debt may want... Read More
Does this Sound like You? There are 100 shopping Days... Read More
Debt consolidation loan services act as a third party intermediary... Read More
Are you looking to consolidate credit card or other debt?... Read More
An online debt consolidation loan allows even people with a... Read More
One of the most common social diseases remains dormant for... Read More
When it comes to debt consolidation some people dream of... Read More
Many different types of financial aid are available to you... Read More
The average American household has nearly $10,000 in credit card... Read More
If you are overwhelmed by debt, there are options you... Read More
Planning For Debt Elimination Without Surplus CashPreviously we looked at... Read More
Millions of Americans are finding it hard to pay their... Read More
Here is a useful guide to what is Debt consolidation.... Read More
If debt is a way of life for you, it's... Read More
It is said that a pet tiger cub can become... Read More
Are you wondering why choose a debt consolidation loan? If... Read More
Sometimes life can get on top of you and out... Read More
Credit card debt reduction is an important part of the... Read More
If you are looking for a company that will help... Read More
Debt consolidation loan services act as a third party intermediary... Read More
Are you wondering why choose a debt consolidation loan? If... Read More
It is said that a pet tiger cub can become... Read More
Consumers looking for a way out of debt may want... Read More
Consolidating loans makes sense but only if you can pay... Read More
Feeling like you're on the brink of financial disaster? You're... Read More
Here is a useful guide to Debt Consolidation Loans. A... Read More
Debt consolidation has become big business in this country over... Read More
Debt consolidation loans can be the answer to a number... Read More
Debt management fees can vary vastly from one company to... Read More
For millions of homeowners, refinancing is the perfect way to... Read More
As long as consumerism flourishes most of us will be... Read More
Recently passed by Congress, the Bankruptcy Abuse Prevention and Consumer... Read More
Private Student Loans ? dispelling the mythsIf savings, grants, scholarships,... Read More
If you believe in the good in people then you... Read More
It happens to the majority of us, credit card debt... Read More
A secured debt is a debt in which the creditor... Read More
Planning to devise a permanent solution to the problems of... Read More
If you are in debt, you have several options available... Read More
Debt consolidation is a popular topic these days. The average... Read More
With the popularity of plastic money in the present age,... Read More
Credit card debts, auto loans debts, secured loans debts, unsecured... Read More
When it comes to debt consolidation some people dream of... Read More
Debt consolidation programs can help you lift the burden of... Read More
Have you ever seen a commercial or an ad promising... Read More
If your debt is becoming difficult to get on top... Read More
Deciding to file for bankruptcy is a decision that should... Read More
If you're looking for the best way to reduce the... Read More
In a world where people use credit as much as... Read More
Are debt settlement companies scams? It's a simple question so... Read More
Last week, a security exploit at CardSystems Solutions, Inc, a... Read More
As any report on the subject will reveal, million of... Read More
Debt Consolidation |