The Significance of Settling Your Debt With a Debt Settlement Company

If you’re facing major financial challenges in your life and you’re having a difficult time paying off bills, settling your debt through a debt settlement company could help you recover faster than if you were to try to do it on your own.

The trials and tribulations that come with unsettled debt can follow you (and your family) for the rest of your life and sometimes can be passed on to your family and children. In most cases, when you leave behind unpaid debt that can be collected through family and can cause resentment and additional turmoil.

There are basically two options you have when it comes to debt settlement: 1. Do it yourself. 2. Hire a debt settlement company to take care of the dirty work for you on your behalf.

Of course, you are always free to choose to try to settle your debts yourself, but this can take a great deal of discipline and focus over a period of years to settle completely. Also, your bargaining power to pay less than what you owe is reduced when doing it on your own because debt collectors can be nasty and unforgiving.

However, when they’re up against a team of professional settlers, it’s like having a good poker hand to play against your opponent. Instead of one good card in a bad hand, you have multiple good cards creating a good hand.

Professional debt settlement companies are known to pull out all the punches to fight on your behalf behind the scenes. Also, your bargaining power increases dramatically. This means if you owed for example $100,000 to various companies, a debt settlement company can reduce that to as low as 40%, or $40,000. This is a huge savings compared to paying the entire $100,000 (not including interest payments on the full amount).

In most cases, a reputable settlement company can pay off your entire debt in as little as 2 years – sometimes 12 months depending on current income, debt, and determination to pay it faster.

On average, honest debt settlement companies will only take on clients with a minimum of $10,000 in debt. If you’re dealing with anything less than $10,000 in debt would be a waste of time and money for both the company and debt holder as it would be easier for you to pay it off through normal means.

The way debt settlement companies work generally follow this template: People call and talk to someone about settling the debt. The settlers take on the client and assess their debt situation. The settlers begin the process of negotiating a lower debt on your behalf. If successful, the settlers get a 14% to 18% fee of the settled debt amount usually as payments over a period of 12 months.

Although most settlement companies prefer not to give advice on how to save and manage their money, they often do recommend solutions and programs on how to control spending behavior.

The biggest fear most people have is damaging their credit score. And, the reality is it’s unavoidable. If you’re settling a large amount of debt for less than what it’s worth, chances are it will show up on your report as “paid – recovered” or “paid – settled”. Not “paid – in full”. Obviously, paying in full is preferable to help sustain your credit, but for most people paying in full is not an option and would prefer a quicker fix.

However, just because you won’t get full credit for settling a debt doesn’t mean you can never recover. It’ll take time. But, it’s a far superior option than not having paid anything at all. Besides, it won’t take longer than 12 to 24 months to get your credit back to where you want it to be after your debts are settled.

A word of caution: Debt settlement companies are largely unregulated. They are known to prey on the desperate and can be a bigger pain in the butt than the debt collectors themselves. Therefore, due diligence is required to ensure you get the best service possible at a reasonable price.

In conclusion, settling your debt with a settlement company can be a significant moment in your life because it’ll free you from threats, pressure, and the stress it causes you.

For more information about settling your debt with a debt settlement company, you can just visit our website. We also provide credit card debt settlement programs for your credit card debt problems, so just make a tour on our site.