subject: Personal Debt Relief Advice - How To Clear 50% Of Your Unsecured Debt Off For Good [print this page] Personal Debt Relief Advice - How To Clear 50% Of Your Unsecured Debt Off For Good
If you are looking for personal debt relief advice, it is always advised that you get rid of at least 50% of you debt for good and start living a healthy financial life. So what happens to the remaining 50%? You will have to make a one time payment to the creditors and clear off your dues! What is this method of debt relief known as and how does it help the consumers? This method is known as the method of debt settlement and this method helps the consumers to not only get out of their debts but also to maintain a good credit score.
This method requires the consumer to hire a professional debt settlement firm to get better results. This means that the settlement can be done by the consumer himself or herself. However, in case of self negotiation, the success rate is significantly lower than that attained in a professional approach.
In a professional approach the following steps are followed:
The negotiator advises delinquency and the consumer follows the advice.
The negotiator then notifies the creditor with a formal letter about the inability of the consumer to repay the debt in full and suggests settlement in turn.
The creditor hires a collection agency for a bare minimum deal of 20 cents to 30 cents per dollar and asks the agency to recover the loan. This deal is completed after the creditor waits for 3-4 months.
Once the collection agency takes over, the negotiator contacts the lender with a better deal and offers a bulk 30-50% repayment based on the demand that the remaining amount needs to be eliminated completely.
This is where the negotiator plays the trick. The negotiator puts forward the deal but with an implicit threat that the consumer will be hard pressed for bankruptcy in case the creditor turns its back to the deal offered.
The creditor at this point has no option other than accepting the deal and then wipes out at least 50% of whatever the consumer owes to the creditor.
A new agreement comes in place and the consumer needs to repay the remaining amount within a specified time and becomes free of debt.
This is how the settlement process works. However, the consumers need to know that during the process, the credit score will take a hit but when the whole thing is complete and the consumer pays the remaining money to the creditor, the credit score is revived and a clean cheat is given.
Debt settlement is a viable option to filing bankruptcy and is becoming increasingly popular amongst Americans with over $10k in unsecured debt. Creditors are ready to negotiate. You can literally eliminate 50% of your unsecured debt with a settlement.
