subject: Debt Settlement 101 - Understanding Your Leverage in Debt Negotiations [print this page] Debt Settlement 101 - Understanding Your Leverage in Debt Negotiations
There is nothing fun about finding yourself in debt and it is certainly not a matter to be taken lightly, but it's not the end of the world either. You first need to take control of the situation and start to get informed as to what you can do to start paying your rates more efficiently and how you can even eliminate a big part of your debt altogether.
The global situation is tough, but it can actually be more of a help than you think. It all comes down to the fact that creditors are companies that want to stay in business and profit and you going bankrupt will not help that, because with bankruptcy they usually don't get any of their money back. So you can see, it's in their best interest to sit down and talk to you if you come to a point where you can't pay them back.
Once you have understood this, then it's time to go and get a negotiator, preferably from a good lawyer-based agency, that will help you cut as much as possible off of your debt. A good deal is usually at least fifty percent off, but there have been cases with as much as a seventy percent cut. This reduction may include annual fees or penalties and a settlement generally has a much lower interest - the only thing you need to worry about is being able to pay the remainder off in the give time frame. Whilst negotiations may last up to five months, you will have to finish your payments in about three years, which is not so hard to do if you have a good payment plan.
If you are willing to maintain a good relationship with your creditor throughout this process and if you negotiation agency is a good one, then you will probably have no problems in paying your debt. And even if your credit score may fall a little, you can increase over time so that you get your original score back.
The key to a good financial future is a good relationship with your creditor, and in some situations, negotiating your debt with them is the best thing to do.
Debt settlement is a legitimate alternative to filing bankruptcy and often makes sense for consumers on the verge of bankruptcy. There are also other debt relief options available so it would be wise to speak with a debt relief specialist to go over your different options. For a free consultation from a debt relief specialist in your area check out the following link:
