subject: Credit Card Debt Settlement – A Credit Debt Relief Alternative To Bankruptcy [print this page] Credit Card Debt Settlement A Credit Debt Relief Alternative To Bankruptcy
Can credit card debt settlement help avoid bankruptcy? Yes. Bankruptcy is always the last stop for people with unsecured debt who cannot make their repayments and with good reason. It's a very traumatic and destructive process. It destroys a person's credit completely for ten years, and it carries an enormous stigma that is very difficult to recover from. Some people never do recover. It might bring credit debt relief, but it is a very big price to pay for not being able to pay your debts especially if circumstances have simply escalated beyond your control.
The world has lived off credit for too long, and eventually the bubble was bound to burst. Now hundreds of thousands of people have unsecured debt they can't repay. As with any crisis, eventually people come up with alternative solutions, and credit card debt settlement is one way of securing credit debt relief.
Strangely, one of the advantages of the global crisis is that credit card companies stand to lose a huge amount of money now if they force too many people into bankruptcy. So they have become open to negotiation. Companies providing credit card debt services have sprung up to fill that negotiating role. Because they bring a lot of business to the creditors, they have a degree of negotiating clout which individuals don't have and probably never will.
As a debtor, using a professional third party has a lot of advantages. They understand the process, they aren't emotionally involved, they have contacts within the credit card companies who readily deal with them, and they understand the fine print. Their role is to study your debt, your budget and your financial circumstances, and create a plan which will allow you to repay about 60% of your debt over a specific period.
If you are considering credit card debt settlement, it's important to know that whilst it is a viable option, there are many unscrupulous companies or individuals posing as professionals. They will take a large amount of money upfront as well as monthly payments, and walk away with your money after a period, having failed to negotiate a settlement. While the negotiation process is happening, debtors may still be harassed by collection agencies.
So it's imperative to do your research on the company you are thinking about using. If you are looking for honest reviews, ignore all the "review sites" because they are affiliate marketers with no investment in telling the truth! Also, ask questions of the company you want to use. They should have online support. Find out how they operate, what they charge, what you can expect realistically, how long it will take to pay off your debt etc. If you get vague answers, walk away. Never make an impulsive decision, especially over the phone.
