Drug testing

Debt Settlement : What You Need To Know

Debt Settlement companies work with your creditors to help you reduce your unsecured debts though arbitration and negations. The important thing to realize about Debt Settlement is that it is a different type of program than Consumer Credit Counseling or Debt Reduction. Traditionally, these types of programs work with your creditors to lower your interest rates. Debt Settlement companies work with your creditors to reduce your credit card and unsecured debt balances, sometimes by as much as 40-60%! While this type of program can be quite effective, there are some major issues that must also be considered.

Typically people in need of Debt Settlement are people who have suffered some type of financial hardship. This can range from job loss or divorce to medical issues. Debt Settlement is for people who are deep in debt and are without the means to repay their creditors. These types of people should be the only ones to use Debt Settlement. Debt Settlement should not be used by someone who is simply trying to escape their financial obligations.

When you begin a Debt Settlement program, there is normally some type of startup fee that will be charged for services. However, this fee should never be more than you're your monthly payments will be. Additionally, the company will most likely charge you a monthly maintenance fee. Some companies charge a flat fee of that ranges from 10-15% of your total outstanding balances.

Once you have joined a Debt Settlement program, you will start saving money, on a monthly basis, so it can build until you have enough money to begin settling on one or more of your current accounts. Under no circumstances should you do business with a company that requests that they hold your money in an "escrow account". You should always be in complete control of your settlement funds. The Debt Settlement Company will contact your creditors and begin negotiating a reduced payoff amount. Once the company negotiates an acceptable, written, settlement offer, they will arrange for you to send funds from your settlement account to pay off that debt. This process will be repeated for each creditor until all of your debts have been repaid. As each of your creditors receives payment, you should receive written confirmation documenting that your debt has been paid in full. This documentation should come from the creditor via your Debt Settlement Company.

It is important to remain cognizant of the fact that while you are accumulating funds in order to pay off your debts you are still accruing late fees and interest charges, which is increasing your balance. If the Debt Settlement Company that you are working with charge a settlement fee, request that the fee be based upon the original balance, not the current balance!

By not making the required minimum monthly payments to your creditors, it is possible that you are breaking the terms of your agreement with them and most likely will be reported to consumer reporting agencies as a delinquent customer. This is the case whether you are currently enrolled in a Debt Settlement program or not. Upon enrolling in a Debt Settlement program, your credit score will probably get worse before it gets better. Additionally, it is possible for creditors and third-party collection agencies to use legal means as a way to collect debts. However, the likelihood of being sued or having your wages garnished depends largely on the creditor that is owed money. If you currently earn a respectable salary, own a home that has a sizable amount of equity, or can most likely afford to repay your current debts without the use of credit counseling, Debt Settlement, or bankruptcy, then there is a possibility that a judgment may be filed against you if begin to miss your monthly payments.

It is important to consider both the pros and cons of Debt Settlement prior to using it as alternative to filing bankruptcy. In many cases, with a sound budget and proper planning, it is possible to avoid debt related problems altogether.

Alan Barnes IAPDA Certified Debt Arbitrator President and CEO of Debt Regret http://www.debtregret.com

limousine chicago service
In The News:

Slowing Spending - The Key To Your Debt Plans Success

Anyone who embarks on a debt reduction program should know... Read More

The Road to Debt Relief

Living with debt is not something someone hopes for, but... Read More

Ten Ways to Get Out of Debt

1) Use your AssetsIf you have assets with some significant... Read More

The 5 Secrets to Getting Out of Debt Fast

As they stare down at a teetering pile of bills,... Read More

Is Filing for Bankruptcy an Option for You?

Bankruptcy laws give debtors a way to resolve debt by... Read More

How To Avoid Medical Collections

With medical collections costing doctors millions upon millions of dollars... Read More

Bankruptcy Reform: Designed to Protect Big Business

Who will benefit from the new bankruptcy reform laws? The... Read More

Debt and Financial Optimism in the UK Continue

With ?1.3 trillion pounds worth of debt in the UK,... Read More

British Families and Debt

There is current concern from the Bank of England that... Read More

Debt Validation: Do you have to pay ?

It happens all the time. Debt collectors try to collect... Read More

Credit Card Debt: How to Get Rid of It

This method is simple, but requires some discipline.First, you have... Read More

Bankruptcy Abuse

Bankruptcy is little more than a smack on the hand... Read More

How to Reduce Your Debt in 5 Easy Steps

If you have incurred substantial personal debt, consider these options:... Read More

New Bankruptcy Legislation May Make it Harder to Find an Attorney

The recently passed Bankruptcy Abuse prevention and Consumer Protection Act... Read More

Bankruptcy Reform

There are some new bankruptcy laws going into effect before... Read More

Dont Drown Your Debts, Manage Them!

Are you among the millions of people who have found... Read More

5 Methods Toward Reducing Your Debt

Decreasing your debt is paramount to having a good credit... Read More

Use A Debt Checklist To Examine Where You Are

A Debt Checklist allows you to look at items and... Read More

How to Negotiate Debt Settlements

Knowing how to negotiate debt settlements is the key to... Read More

Debt Help and Advice for the UK

At some time or another during our lives most of... Read More

New Bankruptcy Law Will Not Protect You from Identity Theft

Recently passed by Congress with overwhelming support, the oddly-named Bankruptcy... Read More

Credit Repair - Understanding The Basics

What is Credit?Credit means that you are using someone else's... Read More

How Do I Lower My Debt Burdens?

How do I lower my debts?There are several ways of... Read More

Dont Let The Good Times Bury You

It is vital to get rid of debt while things... Read More

New Bankruptcy Law ? Targeting the Wrong People?

Last April, President Bush enthusiastically signed into law the oddly-named... Read More

led parking garage fixtures induction lights Pete's produce .