"How Can I Be Sure That My Creditors Will Settle?"

"How Can I Be Sure That My Creditors Will Settle

?"

In the 14 years of settling debts for my clients, I've only had 6 accounts that either the creditors refused to settle, or offered a payment plan. And I've settled over 2,500 accounts.

Why such an extremely high ratio of settled accounts? Am I that good?! The answer is...no.

Credit card companies are just like any other "for profit" business. They want to maximize profits. And by not settling withstruggling debtors,they are not maximizing profits.

By not agreeing to settlewith a consumer'sdelinquent account, the debt collectors have threemain options: 1)do nothing and walk away from the account and hope somedaythe debtor pays the debt. 2) sell the delinquent account to a debt collector. 3) sue the debtor.

Creditors Would Be Foolish Not To Settle

First of all, If the creditors do nothing, chances are slim that they will get repaid. Since consumers are not legally responsible to pay old, defaulted accounts, most people don't see the point in paying off the account. They reason to themselves "why should I pay it when I'm not legally responsible for that debt anymore?

Next, If the creditors sell the account to a debt collector, they will only receive about 5-25 cents on the dollar. Not very attractive., On the other hand, if your creditors settle with you, the average settlement is about 45%. That means that the creditor collects an average of about 45 cents on the dollar-much more profitable than selling your account the account to a debt collector, right?

Last, if a creditor sues a debtor that doesn't have a lot of assets, the courts may or may not require the consumer to repay the defaulted (unpaid) debt. The courts use income and expense guidelines to determine if the debtor may qualify for chapter 7 bankruptcy, which is "debt forgiveness" . If the court allows the debtor to file chapter 7, then the creditor may get nothing. In fact, the creditor actually incurs a loss because of lawyer fees, court costs, etc.

The vast majority of creditors would much rather settle than sue. It's much too risky to sue. Besides, even if the debt collector wins a judgment from the courts against a debtor, there's no guarantee that the creditor will ever get paid. In that event, the debt collector will be in a worse situation than before-having spent $1000's in attorney, court and administrative fees, and still not able to collect from the debtor.

The reasons that creditors settle, is that it simply makes dollars and sense! To discover the fastest method of eliminating your debt, please visit us at http://debtfreesolutions.mobi

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