subject: Can't Pay Back Credit Card Debt? - A Proven Way to Claim a Financial Hardship and Eliminate Debt [print this page] Can't Pay Back Credit Card Debt? - A Proven Way to Claim a Financial Hardship and Eliminate Debt
Most of the people find it difficult to believe that there are ways in which one can get out of debt and completely avoid bankruptcy. One such legal way is through debt settlement. Through this method it is possible to reduce the debt amount through negotiations. Here both creditor as well as debtor agrees to reduce the total amount of debt to consider that amount as a full payment.
But we all know that it is not under usual circumstances that the creditor would agree to such an agreement. If the debtor keeps paying the minimum amount due to the creditors they would not even consider this type of negotiation. But the scene changes if the debtor has been missing out on his payments for 4 to 6 months or even more. The credit card companies try to settle accounts if the account is on the verge of going into collection or if the debtor is on the verge of filing for bankruptcy. Under both these scenarios the debtor is about to lose a major part of the loan amount so it is beneficial for them to settle the account instead.
A debtor has to pay some money to the credit card companies in exchange of the settlement. Usually the creditors ask for that money in one single payment. It is also possible to negotiate to pay that amount in instalments over a period of time if he does not have so much money in hand.
The procedure involved is straight forward hence a debtor can negotiate a deal himself or if he does not feel very confident he can hire a debt settlement company to negotiate on his behalf. A good settlement company can get a debt reduction of about 50 % of the total balance.
Debt settlement is a legitimate alternative to filing bankruptcy. If consumers are experiencing a financial hardship and have at least $10k in unsecured debt then debt settlement can be a legitimate way to eliminate up to 70% of that balance.
Check out the following link to get a free consultation from a debt relief specialist in your area:
