subject: Debt Settlement Relief - How to Legally Fight and Eliminate Unsecured Debt [print this page] Debt Settlement Relief - How to Legally Fight and Eliminate Unsecured Debt
Unsecured debt includes credit card bills, medical bills, student loans, personal loans etc. Unlike secured loans, there is no tangible asset that can be seized in case of non payment of these loans. Therefore these loans have to be settled with the creditor using various debt settlement relief options available in the economy.
Any kind of attempt to eliminate unsecured debt has to have some kind of legal backing. Debt settlement relief programs are being taken seriously by the present government because of the recession fiasco that has affected the economy. With more and more people filing bankruptcy, the creditors are also giving debt settlement a fair chance.
A settlement to eliminate unsecured debt is achieved either in a 'formal way' or, an 'informal way'. In an informal method, the consumer may strike a deal with the creditor and explain to him his or, her financial condition, the amount to be paid, the date of commencement of payment and the number of installments to be paid. It is necessary to get all the details of the informal settlement in writing. This is the only proof of the settlement, and one can produce it in case of breach. Although complete elimination is not possible this way, a discount of around 50% can be obtained.
In a formal way of settlement one should keep a track of Statute of limitation and debt validation of the unpaid amount. Gaining information about government debt settlement relief programs is also very useful. There are many agencies that provide solution to debt related problems. But they may not be available to every one all the time because there are some qualifying factors involved.
A settlement should be arrived into if the loan amount is more than $10000. Application of debt validation strategy is a legal way to eliminate unsecured debt or, reduce it by certain percentage. Another legal way is the Statute of Limitation (SoL) that starts when the consumer fails to pay a certain installment of the loan or, receives a letter from the creditor asking the consumer to pay the full amount.
It is the legal time frame within which the collectors can collect the debt. If this time (which is generally 7 years) is over for the particular debt, then there is no way the creditor can do any thing to gain a penny. Debt settlement through this method can ensure a total elimination of debt. (CAUTION: SoL for different loans is different. Please check the SoL of the particular loan before proceeding with the settlement)
Any kind of difficulty faced by the consumer in negotiation can be taken care of by the debt settlement relief agencies. They are experts in the matter and are more persuasive. They can even help to stop the harassing calls from the creditors.
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.
