Eliminate Credit Card Debt - How to Cut Debt by 50 Percent
Settlement is a process in which the debtor and the creditor agree on a certain percentage
of the total debt owed to be accepted as a final settlement amount. The settlement offer varies from one company to another. It also depends on the financial condition of the debtor and how badly the company wants to be paid. If you have ten thousand dollars in unsecured debt then you can use debt settlement to come out of debt.
People looking at debt settlement as their option are concerned about how much money they can negotiate off their debt. The standard figure shows that a debtor can get 40 % to 60 % of his debt amount reduced through this method. This number is greatly affected by the facts like how long the account has been with the collections. It also depends on how much risk the creditor associates to the fact that the debtor will be filing for bankruptcy.
Most of the creditors settle for an amount that is less than the actual amount because they think that if an account has been into collections for a long time then the chances of that customer filing for bankruptcy is very high. In case of bankruptcy the creditors lose all the money that is owed to them.
To start the settlement process you will need to get in touch with your creditors. Many creditors send out settlement offers after a period of time, while others don't in which case you will have to contact them. Once the creditors agree to settle the account you can negotiate an amount that you will be comfortable to pay. You will need to a pay the remaining amount in a single down payment. Monthly installment option is also their but most creditors want a down payment.
Eliminate Credit Card Debt - How to Cut Debt by 50 Percent