When it comes to seeking credit card and debt relief, many Americans feel the only viable option they have is credit counseling or filing bankruptcy. However, a debt settlement program satisfies your creditors for less than what they claim you owe and saves you as much money as possible during the process.
The banks would love to keep you in the mind-set that your credit score is absolutely the most important part of your life and by not paying them back in full would decrease your score. By all means your credit is important but should not completely dominate your life. This mentality works in the banks behalf and keeps you in fear, just where they want you.
When researching the option of debt settlement as your choice to become debt free understand that there are basically two types of companies to use when considering who you will choose to settle your debts. First there are the very common non-lawyer based debt settlement companies which comprise of over 95% of the companies currently advertising over the internet and TV. The rest are Law Firms that practice debt settlement as one of their services.
Please consider the following if you are looking for help with debt settlement:
You can usually save 20% on your own with very little effort but any more than that requires experience and negotiating savvy. The company should save you at least 40% of your debt including fees and paying your creditors.
Make sure your payback plan is in a realistic time frame to complete this process.You should choose a debt settlement company that will focus and emphasize on enrolling you to becoming debt free in two years or less, but only under specific circumstances no longer than three years.
One of the negative aspects of debt settlement is that you do need to fall behind in order for these creditors to be willing to accept less. While falling behind you will get barraged with calls from collection agencies. The Fair Debt Collection Practices Act states that if a client has attorney representation the 3rd party collector by law must deal with the attorney and not the debtor.
Check the company’s reputation. A good place to start is to check the Better Business Bureau (BBB). Also check how long the company has been in business. Every company starts at the BBB with an “A” grade but not everyone will keep it!
Check the state bar for the attorneys standing if you are going with a law firm.