subject: Debt Settlement Companies Vs Creditors - Who Has the Upper Hand in Debt Negotiation? [print this page] Debt Settlement Companies Vs Creditors - Who Has the Upper Hand in Debt Negotiation?
Debt settlement Companies Vs creditors is a long drawn argument. When a consumer takes a loan or creates debt through credit cards, it is his moral duty to pay the amount back to the company. But sometimes because of genuine reasons the consumer is unable to pay back and hires a Debt settlement company on his or, her behalf to negotiate the payable amount.
Settlement companies are experts in debt negotiation and their persuasive qualities always work in favor of the consumer. But the question here is who has the upper hand in the negotiation? This may come as good news to the consumer because they are the ones who actually have the upper hand in the deal.
The creditors have to fall back because it is the debtors who have something that they want. If they drive the debtor to the extent of bankruptcy, then no one gains anything. So, even if they do not show it, they make sure debt negotiation settles (at least to a certain extent) in the debtor's favor.
The settlement companies know who owns the debt at the point when calls for repayment are made. If it is the collection agencies then the debtors can expect a massive discount on the debt. By now every one knows the little tricks the collection agencies take recourse to in order to gain astonishing profits.
The negotiation starts by offering to pay 25% on the total debt amount or, less. It may go up to paying 50% or, may be settled below 25%. In the year 2009, 50% was the average settlement rate. Even at this rate the creditors, especially the collection agency makes a good profit.
Therefore it is quite clear that in a debate about debt settlement companies Vs creditors, the former is an obvious winner. CAUTION: choosing an unauthentic debt settlement company may land up a consumer in further misery. There is a list of authentic companies that one can look for over the internet or, discuss with people who have dealt with similar issues.
Debt settlement companies not only help the debtors, they indirectly help the creditors too. They help the creditors by being more reasonable and grant the debtor a significant discount that they can pay back. Consumed by greed the creditors tend to pressurize the debtors to pay the full amount along with added interests, which is illegal. This may lead the defaulter to declare bankruptcy which is doom to both parties. A reasonable settlement amount leaves both the creditors and the debtors satisfied.
Debt settlement companies are widely available in just about every state however some are just flat out more experienced than others in debt negotiation. That's why it's so important for consumers to use debt relief networks. These networks qualify and only accept the best performing debt settlement companies.
