Debt Settlement
It’s time you knew this.
You have rights regarding your unpaid debts. Of course, a creditor can take legal action against
you in court and potentially win a judgment. Don’t assume that this will always happen, however.
Is this you? Feeling consumed and overwhelmed by debt?
Too many consumers believe that their debts are overwhelming and that there is nothing they
can do other than file bankruptcy. Not so. And don’t believe those frightening tales told by
collection agencies of gloom and doom, especially about garnishment and seizure of property.
Debt settlement is a practical solution that is very effective.
Defining and Understanding Debt Settlement
Debt settlement, also known as debt negotiation, is a method used to permanently eliminate
some types of debt. Often reserved as a last attempt to collect a debt prior to writing it
off as uncollectible, creditors are sometimes willing to accept a reduced financial settlement
in order to fully satisfy a debt.
Can Debt Settlement Hurt My Credit?
One of the most common questions that individuals have regarding a debt settlement program
is how their credit report will be affected. Some experts state that debt settlement is damaging
to a credit score; but compared to the alternative of having continually reported late or missed
payments, debt settlement shows that you have made an attempt to repay the creditor within
your means. Once a creditor accepts a debt settlement, they will report the account as "Settled
Account" or "Settled in Full" to each of the three credit reporting agencies,
including Experian, Equifax and TransUnion. Every 12 months, you can obtain a free copy of
your credit report from each of the three credit reporting agencies noted above.
Depending on the total amount of debt that you currently owe, a debt
settlement program can take several months or even several years to complete. They are
one of the industry's best kept secrets, allowing debtors to get in control of their finances.
