subject: Negotiating With Credit Card Companies - How To Reduce Your Debt Drastically [print this page] Negotiating with credit card companies to reduce your debt drastically is a great idea. However, there are some facts that require attention and remember that if you are on a DIY Arbitration mission, you need to know the basics of settlement and avoid any sentimental angle just to ensure that there is no backfire! Read on!
The basic knowledge of requirements:
The unsecured debt that you have must be at least $10,000. Anything below this mark will be rejected straight away. This is so because of the fact that this figure has been fixed by the law!
The debt needs to be consolidated in one place in the event of multiple debts. This is to make sure that the cost and time of settlement is minimized as far as possible.
Hire a professional debt settlement firm to get a good deal. Make sure that the firm is a non-profit one. But, how do you identify that? Ask for the internal revenue code 501 (c)(3). This is the code that is given by IRS and the code stands as a proof of being non-profit. Also ensure that the firm has TASC certification.
The basic knowledge of settlement:
If you are looking forward to reduce your debt drastically, make sure that you follow the advice of the negotiator. GO delinquent when the negotiator advises and stop making any payments to the creditor. The creditor will then wait for 90-120 days and then sell off the debt to a collection agency for as low as 20-30 cents on each dollar collected from you. The negotiator will then contact the creditor with a new deal of 30-50 cents and will also threaten the creditor of bankruptcy or charge-off in case the creditor declines the deal. However, the same will be mentioned in the formatted letter that reaches the creditor from the negotiator when you go delinquent. The letter will be factual in the sense that it will describe why you will not be able to afford the debt any more. Each fact that will be furnished will be supported by a document of proof.
The creditor will never want bankruptcy and will therefore, agree to the deal on the basis of the fact that the deal will mean 100% ROI for the collection agency. The creditor will then eliminate the debt that you have by a huge amount of 50% and it can reach up to 70%. This is how you reduce your debt drastically!
Debt settlement is a legitimate alternative to filing for bankruptcy. There are also other debt relief options available which is why it would be wise to speak with a debt relief specialist.
Negotiating With Credit Card Companies - How To Reduce Your Debt Drastically
