Debt settlement is becoming the option of debt riddled Americans to help them achieve financial freedom. It used to be one of the less reputable options to get rid of debt because it involves a seemingly deliberate manipulation of the creditor. What happens is you will stop paying the debt so the creditor will be forced to accept when you finally try to negotiate a lower payment.
In this debt relief option, instead of paying your creditor, you will set aside the money to save up for a bigger payment. This is usually a lower amount of your balance. As your creditor gets desperate to get payments from you, this savings will get bigger. Once you have reached a certain percentage, you will try to negotiate with a creditor and appeal to them so they will agree to a debt settlement. Oftentimes, a debt relief expert will help you with this. You can use the amount you have been saving up to pay a huge portion of the debt – while the rest will be forgiven and wiped off.
How to Increase your Chances to Get a Debt Settlement
Even with a debt relief company, the chances that all your creditors will agree to a credit card debt settlement is not guaranteed. The key is knowing what percentage of the debt you will negotiate to pay for. You need to analyze the situation carefully to determine the best chance of getting the credit card companies to settle with you.
Part of this process is understanding the nature of your creditors. There are instances that the aggressive ones would always settle for amount to be paid back that is relatively higher than other creditors. But this behavior usually change as time passes by and is even dependent on the state you are in.
Your payment history is also a big consideration in getting a favorable result in debt settlement. Creditors have an industry accepted system of getting your past and current payment history to categorically verify your payment performance with other creditors. They are able to see how you are, it at all, making timely payments. Bottom line is, if you have been making current payments, you will not stand a chance in settling your debts. You need to be late in order for them to consider your proposal. Usually, settlements are made for debts that are 90 to 180 days late – with the consideration that you are also late in your other creditors.
Another good scenario to settle is when you are faced with a lawsuit. Some credit card companies send summons to those unable to pay them. Upon reaching this point you have an estimated 30-day window to try to settle with your creditors. Usually, you can get a better debt settlement agreement as the credit card company will be trying to avoid a court session unless you are unresponsive. While this is not really advisable, if you are in this situation, you know that you should take advantage of it.
NationalDebtRelief.com is a debt relief company that can help you achieve financial freedom. Give us a call and we can discuss how we can get the best settlement for your debts.