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Best Credit Debt Settlement Program

Yes, there is an alternative to bankruptcy: debt settlement. By entering into a debt settlement program you’ll be able to reduce the total debt amount you owe and set up more manageable monthly payment that may help give you the peace of mind you need to organize your finances and get your financial life back on the right track….in due time.

Why would creditors and lenders agree to settle with you and reduce your debt? Simply put, it’s not in their best interest for them to see you go bankrupt, since your declaring bankruptcy means they won’t be able to collect any of your debt at all. Better for them to settle for a partial payment than nothing. That said, actually getting your creditors and lenders to negotiate with you can be very difficult, and with some creditors it might even seem impossible. With the help of good professional debt settlement services, however, the task can be much more efficient and stress free for you.

A professional credit card debt settlement company can help you consolidate your bills into a single reduced monthly payment. You pay a fixed amount each month into a trust account they will set up for you and when there’s enough money built up in that account, they will begin to negotiate with your creditors directly, so you don’t have to! An experienced debt settlement company will already have relationships established with all the major creditors making the process often faster and smoother than if you tried it on your own. Typically, a debt settlement program will attempt to have you debt free in less than 3 years. To find the right debt settlement programs from trustworthy debt relief companies that fit your needs, fill out the FREE REPORT form on the right to learn more. For more information on debt relief programs and how you can benefit from them, read on as this site has hundreds of pages of helpful information.

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Debt Settlement Articles

How Do I Pay Bills With Debt Settlement Programs?

: April 2, 2007 4:30 pm : Debt Settlement Program

When using debt settlement programs to reduce the amount of debt you owe, you will pay the bills that qualify for the program to the settlement company, not your creditors (as you’d usually do).

A typical large debt settlement company will set up a trust account on your behalf with a 3rd party organization like a bank. Once you and your debt counselor determine a payment plan for you, you will make that payment directly into the trust account instead of paying your creditors directly.

Why?

The way the debt settlement programs work is that you stop paying your creditors and instead stockpile money in your trust account until the amount is enough to approach your creditors and negotiate a debt payoff. If your debt settlement company tells the creditor they can pay off a large amount all at once, the creditor is more likely to agree to eliminating a portion of what you owe. It’s part of the debt negotiation process.

Is the trust account safe?

You need to be comfortable with the trust account provider that your debt settlement company will use. Be sure to get the name of the company and research them as well before signing up for a program. In general, the large established debt settlement companies will use large trust account providers.

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What Are the 2 Golden Rules of a Successful Settlement for Debt?

: April 2, 2007 3:21 pm : Debt Settlement Program

When you hire a debt company to conduct a settlement for debt that you cannot repay, remember one key point – that your are HIRING them to do the work for you. You use their services because they are the professionals and will know the best way for you to use settlement to successfully get out of debt as soon as possible.

You Need to LISTEN to them for successful debt settlements

Just like you listen to your tax preparer or your doctor, listen to your debt counselor. What will they tell you to do? Stick with their plan. Most likely, they will provide you with 2 primary golden rules for a successful debt settlement:

1. Do not talk to your creditors at all
You hired the debt settlement company to do your talking for you so let them do it. Remember , the settlement is a legal procedure and so your silence is the best way to avoid saying something that could make the process much more complicated (and sticky). They know what to say and when to say it to your creditors. Furthermore, a good settlement company has the established relationships with all the major creditors making the process as smooth as possible.

2. Be prepared to cut back expenses in order to save as much money as possible
The faster you can save, the quicker your company can get you out of debt and initiate the settlement for your debt with your creditors, it’s as simple as that. While they can eliminate up to 50-60% of your debt, they cannot wipe it out without the money you save under their program. Your short term savings will relieve your long term debt problem.

They will set you up on a payment plan so stick to it and if you can contribute even more than the plan specifies each month, even better.

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What Are the Drawbacks to Debt Settlement Programs?

: February 27, 2007 8:10 am : Debt Settlement Program

Of course, nothing is perfect, there are problems with debt settlement programs. Often debt settlement information is provided by salespeople who make it sound too good to be true for many people in debt. It needs to be reviewed carefully as it’s not the perfect solution for everybody.

If I tell a person struggling with credit card debt they can reduce what they owe by up to 60% it sounds perfect. “Where do I sign?” would be a likely response (and often is). However, if you are dealing with a reputable and reliable debt settlement company, they will tell you some of the potential negatives to the program as well.

  • Your credit score will suffer
  • Your accounts will be paid off but will not show up on your credit report as “paid in full”
  • The debt settlement company cannot guarantee they will be successful in negotiating your debts down
  • Bottom line is that debt settlement is a bankruptcy alternative for those who need to get out of debt because they are past the point where they can reasonably get out of their financial situation without a more drastic solution.

    While debt settlement is not perfect, it does help a lot of people who need it and allows them to avoid the even worse case scenario of bankruptcy.

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    Can I Get Sued Doing a Debt Settlement Program?

    : February 2, 2007 3:05 pm : Debt Settlement Program

    This is a common question and rightly so! The thought and risk of getting sued doing debt settlement is scarry to anybody. It is always possible that your creditors could sue you as you go through debt settlement but with a reputable debt settlement company representing you, the risks are often greatly diminished. Typically it is more of a scare tactic than anything else but still any potential for a lawsuit is something to take seriously.

    But Why Is It Unlikely?
    The reason lawsuits are not more common is because every lawsuit costs the creditors lots of money. In many cases they would rather avoid this and take whatever money they can get from you to repay your debts. Each creditor handles their past due accounts differently but a reputable debt settlement company will have established relationships with your creditors and that is often the best defense against the possibility of a lawsuit.

    Furthermore, debt settlement companies with lots of experience will know which creditors are more likely to sue based on their past experience. They should closely evaluate your situation before you become a client and they will let you know. This is why it is so important to use a debt settlement company that is honest and straightforward.

    The best advice I can give is to make sure you ask this question as you decide if debt settlement is right for you and in particular, which company you hire to work on your case. I’ve discussed lawyers roles within these companies here.

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    Do Legal Debt Settlement Programs Require a Lawyer?

    : February 2, 2007 2:53 pm : Debt Settlement Program

    The short answer to this is no. Anyone can negotiate with anyone and reach a legal debt settlement that is binding and that is true with your debt as well. However, having access to a lawyer and companies who offer debt settlement programs that have lots of experience can be very important to help you overcome potential hurdles that may arise.

    Debt settlement companies can be broken into 3 classifications:
    1. Actual law firms that specialize in debt settlement
    2. Debt settlement companies that have lawyers on staff
    3. Debt settlement companies that have no in-house legal counsel

    I recommend that it is best to use a company that has a lawyer on staff, a law firm on retainer, or a law firm that specializes in legal debt settlement services.

    There is always the small possibility that you could be sued by one of your creditors during the process and you want a settlement company that can guide you should that occur and smooth out the process through a series of legal letters, etc.

    Experience counts so be sure your debt settlement company has plenty of it. The ones who have been around for several years and have thoudsands of clients have seen it all so should something go wrong they will know how to handle the situation.

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    If I Use a Debt Settlement Company to Settle Debt, When Will I Be Debt Free?

    : January 19, 2007 10:47 am : Debt Settlement Program

    So lets say you’ve made the decision to settle your debt in order to get out of debt as quickly as possible without filing for bankruptcy. How long will it take to be debt free? Of course the timeline for a debt settlement plan depends on several factors regarding your personal situation:

    – How much debt do you have relative to your income?
    – How effective the company you choose is at negotiating your debt?
    – Who you owe money to?

    Generally, debt settlement companies such as these will discuss these questions with you during your free consultation. Then they will provide you with a personalized recomendation, a monthly payment budget, and plan that includes a timeline for reaching your goal of debt freedom.

    The industry standard is to have a 3 year maximum timeline for the debt settlement process. In a typical client situation, the plans try to get their clients to be debt free between 18 and 36 months. Be cautious of plans that extend beyond that as often the debt settlement company fees over a longer time frame than 3 years do not justify the savings you hope to incur. Honest companies that settle debt should want to graduate you out of their program as fast as possible and will have your best interest in mind, rather than those looking to rack up fees.

    Three years (or less) is really not that long to be debt free if your other alternative is bankruptcy and a mountain of debt that seems to grow daily no matter how hard you try to reverse it.

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    How Much Does Debt Settlement Help Cost?

    : January 18, 2007 8:10 am : Debt Settlement Program

    Great question! After all, if you are in debt, you do not have a lot to spend, right? Debt settlement help costs vary by company but in general, they take a percentage based on the amount of debt you have entered into their program. The average settlement fee is typically 15% of your debt amount.

    Each company has different ways of collecting the 15% fee (give or take a few percentage points depending on the company you use) of your debt amount. Often times, the cost for your debt settlement help will be built into the monthly payment plan they set up for you while other companies will take the first month or two of your payments as thier fees and after that they take only a small portion of each monthly payment you make.

    There are companies that weight their fees according to how much they save you during the negotiations which gives them an incentive to do a good job for you. This can result in you paying them more than the 15% standard. Some people prefer this method over a fixed 15% fee structure because they like their company to have some skin in the game. So it really depends on your preference and comfort level. Any way they slice it, the cost for your debt settlement help should equal somewhere around 15%.

    Is it worth it? Well that depends on your situation. If you have $30,000 in credit card debt and cannot seem to make any headway in lowering it with your current income, reducing that amount by 40,50, even 60% will certainly help you get out of debt. If you choose a good debt settlement company who say reduces your $30,000 debt to $15,000 and you end up paying them $4500 in fees to help you, you still saved $10,500 overall and got out of debt in less than 3 years.

    …AND you got the support and knowledge you need to make it happen. What is good debt settlement help that can get you out of debt worth to you? Can you get out of your debt without help and a lower monthly payment? If yes, then don’t do it because there are drawbacks to debt settlement. If not, it’s better than bankruptcy.

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    What is Settlement of Debt and How Does It Work?

    : January 15, 2007 9:24 am : Debt Settlement Program

    What is debt settlement (also often called debt negotiation and debt reduction)? It is the legal process of getting your creditors to accept less money than you owe them for your unsecured debts most commonly credit cards, medical bills, large utility bills, and unsecured personal loans. Settlement of debt is very common and has become more so as the amount of consumer debt has increased over the past few years, particularly with credit cards.

    When you are financially unable to repay everything you owe, your creditors will accept a settlement after a negotiation process. The result is that you will pay them a lump sum of money and they will release you of further liability. The amount agreed to is legally binding.

    This negotiations are usually handled on your behalf by professional debt settlement company that understands the process and often knows the right people to negotiate with inside the credit card companies. They do this for thousands of clients so the process is typically smooth and takes less than 3 years to complete which gives you time to save up the money you will need to pay the reduced negotiated debt amount.

    Debt settlement is one solution that is a viable alternative to bankruptcy that allows you to reduce your debt and become debt free faster than many people are able to do on their own.

    Choose a debt settlement company who you trust and they will evaluate your situation. If you qualify for their program they will customize a payment plan for you. Many people who choose this route to become debt free are able to achieve settlement of their debt by amounts of 50% or more.

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