subject: Debt Negotiation Letter - How Writing A Successful Letter Can Save You Time And Money [print this page] Debt negotiation can be done by consumers that are in debt and are not willing to pay a debt settlement company to negotiate on their behalf. This is not recommended in all cases but consumers that know what they are doing and are willing to give it a shot can contact the creditor and settle their debt alone. If you prefer to do things yourself, you will need to start from the beginning and follow a plan until your clear your debt.
The first thing you need to do is send a debt negotiation letter. This is addressed to the creditor and it contains information about you and why you are no longer able to meet the monthly payments. In most cases it is a result of the recession and the consumers has lost his job or suffered a significant paycheck. The letter must also contain an offer, an amount of your debt that you will be willing to pay and that will not force you to file for bankruptcy. This is a good thing to mention in your negotiations as well because the creditor doesn't you to file for bankruptcy because they lose all your debt, at least with the help of debt settlement, they get something in return and you get to pay back your debt and maintain a good credit score.
If they respond with another offer, they are willing to negotiate and now it is just a matter of how big should the reduction be. Don't aim too high and ask for something outrageous like 80% less because you read about it somewhere but don't agree to a deal which you still can't afford to pay back. Try to be realistic and reach an agreement that will make both parts happy.
When the negotiations are done, see how you must pay the rest, either in monthly payments or in a lump sum after a period. The latter may give you a bit more freedom but be sure to not abuse it and fall behind because you are not far from ending up in the same situation. After you pay the creditor, make sure that they state that you paid your debt in full so that your credit score will be in good shape.
Debt settlement is a viable alternative to filing bankruptcy. Most consumers are able to eliminate at least 60% of their unsecured debt while avoiding many of the negative consequences with filing bankruptcy. If you are over $10k in unsecured debt you will be eligible for debt settlement.
Debt Negotiation Letter - How Writing A Successful Letter Can Save You Time And Money
