Many people will often admit that debt can creep up on you. One minute you are doing well and the next you are having a hard time servicing all your bills on time. From this point, it is very easy for the situation to get much worse. If you feel you’re way in over your head, you should get the help of a professional. Debt can ruin your financial profile, business and even largely affect your personal life.
When it comes to how to get out of debt, debt settlement is all about negotiating with your creditors to get them to reduce your debt balance so it is easier to pay off your debt. Debt settlement should not be confused with debt consolidation, which is all about paying all your debts using a single loan and servicing a single payment from then on. Debt settlement companies have professional arbiters with great negotiation skills who have a lot of experience working with many creditors. It is essential to choose a reputable debt settlement company that will work well with your creditors for the best possible settlement.
Advantages of the Debt Settlement Program
Using a debt settlement company has quite a number of benefits to you.
- Wipe Away Part of your Debt
One of the biggest advantages of debt settlement is reducing the total amount of debt that you have to pay off. It would take you much more time and financial strain to pay off the debt without this waiver. Wiping away part of your debt allows you to review your budget and even free up some money to make your payment in time to avoid future debt.
- Re-age your Accounts
Accounts that are past due for over 30 to 90 days usually attract many penalties and this further inflates the amount of debt. However, once you join the debt settlement program, the creditor will bring the accounts back to current status. This will also eliminate the interest from the outstanding balance.
- Live Free of Debt Collectors
Debt collectors are constantly coming up with new and even more humiliating ways of retrieving debt from consumers. They can contact you at home, at work and even physically accost you. You can reduce all this tension by joining a debt settlement program.
- Avoid Bankruptcy
Filing for bankruptcy creates a permanent stain on your credit profile for the next 10 years to come. Your bankruptcy will come up in future jobs, loans and credit card applications. You can be charged with fraud if you fail to disclose your bankruptcy past in case you are asked to. Debt settlement lasts only as long as your debts and once you clear out your debts, you are done.
- Pay Off Debts Faster
The longer your debts drag on, the more you have to pay and the more financial strain you experience. A good debt settlement program can help you pay the debts in a shorter time than it would take to pay them off normally.