Credit Debt Settlements - An Aggressive But Proven Method To Eliminate Credit Card Debts
Online, June 14, 2010 (Newswire.com) - A couple of decades ago, if consumers borrowed in excess of their ability to pay and become insolvent-bankrupt,they would be crippled financially. They will likely never be able to borrow money again and their credit would be completely ruined. Luckily, the world has changed a lot since then and many consumers suddenly find out that being bankrupt is a common scenario in the present day world. It is so common that for some people, being bankrupt, being bailed out by the government, or having to undergo a debt counseling program is just a part of life.
If a consumer finds themselves in a difficult situation not having enough money to cover basic necessities, paying back their debt is never going to be easy. Due to the credit-fueled way of life, so many borrowers have fallen into trouble and this has become a huge social problem. Governments cannot let millions of people ruin their entire lives together with the entire financial system.
After numerous reforms to the financial sector and the legislation, a more flexible way to get out of debt has emerged. This offers a second chance for those who were squeezed by the high debt burden. Methods of Credit Debt Settlement have emerged which gives consumers a clear alternative to filing bankruptcy.
Credit debt settlement programs Credit Debt Settlement Programs negotiate with financiers to win a larger discount on unsecured debts making it easier to settle the remaining debt. They also make the repayment plans more flexible and as a result, provide consumers with a viable repayment plan. Most credit debt settlement services are for a commission which is generally around 10%-15% of the original debt. The average debt settlement in 2009 was around 50% of the balance so the commission fee to the credit debt settlement company is often minimal compared to the overall savings.
If consumers are confident that they can handle the negotiations themselves without resorting to a credit debt settlement company, the same result can be achieved with a significantly low cost. They can save the money which would otherwise be spent on the debt settlement company. However, they need to have a good understanding on the debt negotiation process to succeed. The best debt settlement companies have established relationships with all the major creditors and typically have significantly more leverage negotiating a debt settlement deal than the average consumer does.
If the above option fails, the alternative will be filing for bankruptcy under Chapter 13 of the Bankruptcy Code. Under this method, debtors will have the protection of the Court but need to agree on a settlement plan with the creditors in order to settle the debt in 3-5 years. The settlement plan will be formulated in such a way as to give the debtor some breathing space with his financial position. Under this method, the debtor does not have to liquidate his assets but needs to commit to the repayment plan without defaulting. At the end of the repayment plan, the balance of the debt will be written off and the debtor will be able to lead a normal life and will be able to borrow again in a couple of years.
Debt Settlement is a viable alternative to filing bankruptcy. Most consumers are able to eliminate at least 60% of their unsecured debt while avoiding many of the negative consequences with filing bankruptcy. Most consumers over $10k in unsecured debt will be eligible for debt settlement. To locate legitimate debt settlement companies for a free consultation check out the following link:
Legitimate Debt Settlement Companies
Or Call - 800-931-9612
