So what is debt settlement? How does it work? I get asked questions often. Put simply, debt settlement is the process of negotiating a reduced payout between a creditor and debtor.
If you have sufficient time, knowledge and resources, you can do it yourself. Otherwise it’s often a better idea to hire a professional and pay them to take care of it for you.
If you want to settle your debt yourself, be careful, credit card companies can be bullies so I recommend checking out my DIY debt settlement guide first.
The concept of debt settlement is simple. Your credit card company would prefer to get something, rather than nothing. Cash in hand is always of greater value to your creditor then a debt that isn’t getting resolved.
To settle your debt for less, you need two things to happen.
- You’ll need access to a lump sum of money to make your offer enticing
- You need to be at least 3-6 months behind in your payments with your creditors.
You can sometimes raise a lump sum of money by selling an asset, or borrowing from family or friends.
If that’s not possible, you can use our technique of following a savings budget to raise a lump sum and settle with your creditors at a later date.
Through successful planning and negotiating, most people can achieve a savings of 50-70% on what they owe. So, if you owe $10,000 to your credit card company, you could end up paying $3,000-5,000 as a final settlement on your debt. Here are the loans for legal case settlements that you can have a look at to handle your finances.
I’ve been settling credit card debt for 10 years now and even though the savings are huge. The most common thing I hear from our clients after their debt is all settled is how they felt in control, and that they had a means to fight back against the bill collectors bullying them around.
A debt settlement program is for those that want a champion, and an advocate. Most people just don’t realize that a debt settlement company like Total Debt Freedom is the only debt relief remedy that works exclusively for you.
That is becasue we NEVER accept compensation from your credit card companies. A debt settlement company is also never compensated as a percentage of what you pay back, instead we are often compensated based on what we save you.
For many people, debt settlement is a last stop before visiting a trustee and filing for bankruptcy or a proposal. It is also often less expensive, kinder to your credit rating and faster than visiting a trustee.
Debt settlement works well, but you need to have the appetite to deal with some collection calls, or the remote chance your credit card company sues you. Proper planning, and positioning can nearly eliminate these problems. Canadians have saved millions of dollars by settling their own debt, you can do it too.
If you would like a free quote just call 866 833 1992 or visit our home page here and fill out the on-line form to get all the facts from Canada’s debt settlement leader.
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