Debt Settlement Program

Debt Settlement Program

Settle Up!

That's what you do when the check comes, right? But when you're talking about a debt settlement program, it has an entirely different meaning. We're going to tell you what a debt settlement program can do for you.

When you enroll in a debt settlement program, a professional debt settlement agent who's skilled in the art of negotiation will contact your creditors to get you reductions of 60-80% off of what you owe. First they need to know how much cash you can get your hands on to pay off your debt. Let's say you owe about $10,000 in total, but you only have $4,000. That's not enough to pay everything off. But a skilled debt settlement agent can get your creditors to accept that amount and consider your accounts "settled." In return, however, your creditors will want that balance, in full, right away.

Now, if your debt settlement program can't get your creditors to go that low, sometimes they can convince them to at least give you 1-3 years to come up with the difference. Say you pay what you have now, then you pay the remaining amount over a period of 1-3 years.

Sounds like a pretty good deal, huh? There is, however, one drawback to a debt settlement program. As you can probably guess, your creditors don't like it when they have to write off a big chunk of your debt, but they figure getting something from you is better than getting nothing at all, so they'll comply. But to sort of "punish" you for your financial irresponsibility, they will report your settlement to the three credit reporting agencies. It will effect your credit in much the same way as a late payment. If you can live with that in return for getting most of your debt eradicated almost immediately, then debt settlement might just be for you.

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