Whether we like to confess it or otherwise, debt is becoming as American as apple pie or hotdogs on the 4th of July. In fact, the average US household has $7,149 in credit card debt alone as well as an average total indebtedness of $15,587.
Are you a slave?
Has it gotten so out of control that you've be a slave to your debts? This means do you experience feeling you're working mostly simply to pay it off which all the fun has gone out in your life? If that's the case, you may be wishing you could find debt settlement.
How you can achieve debt settlement?
How may you achieve relief? There are some partial answers such as a consolidation loan, cccs or balance transfers. However, I consider these to become only partial answers simply because they do nothing at all to eliminate the money you owe short-term. A debt consolidation loan might take you seven years to pay off, as the debt management plan you would get through consumer credit counseling would probably take 5 years to complete. If you were to transfer the balances in your high interest credit cards to one with a lower interest rate, you can get some debt settlement however it might likely take you 3 to 5 years to repay the amount you owe around the new card.
Why debt settlement equals true debt relief
A second reason why I only say the debt relief plans described above provide only partial relief is because none of them will do almost anything to actually lower your debt. They're just ways of moving it from one set of creditors to a different, and achieving more time to pay them back. In comparison, a debt settlement programs can bring true debt relief because it would cut back your financial troubles and help you become debt free in 24 to 48 months.
How debt settlement works
Without getting too many details, the way this works would be that the debt consolidation company contacts creditors and negotiates together to take down interest rates and balances, which may likely save you thousands of dollars.
Once all of your creditors sign off on the settlements, you'd be presented with a repayment plan. If you accept the plan, you would start sending your debt settlement company a check once a month rather than pay your creditors. The money you signal the debt settlement company would be deposited into an FDIC-insured trust account and eventually accustomed to pay off creditors.
Not for everyone
While debt consolidation can bring debt settlement to many people, it's not for everyone. First, the only debts that the debt consolidation company can settle are unsecured debts and never those such as a mortgage or auto loan.
Second, you need to owe $7,500 or even more and you shouldn't make any payments on your debts not less than 6 months. Third, debt settlement will have a negative effect on your credit score. This is due to those 6 months when you didn't make any payments on your debts. It was reported towards the credit agencies and can definitely ding your credit score. However, it won't have as serious an effect as if you had declared bankruptcy.
Therefore the net/net is the fact that debt settlement programs really are a fact because of debt settlement. Before you leap into one of these simple programs, do your homework - ensure the company is ethical and reliable - and requires no upfront fees.