During an economic downturn, many people are in debt and they are unable to pay their bills on time. To get rid of debt without filing for bankruptcy, one of the solutions they can consider is debt settlement. This program involves negotiating with creditors to settle the entire amount owed less than the debtor owes. Let’s review some useful information regarding this settlement program.
Unsecured debts such as medical bills, credit card bills, private student loans, personal loans, gas cards and so on can be settled.
Settlement programs do not include tax debt, mortgages, car loans, federal student loans, alimony and child support.
Completion programs usually take around 2-4 years to complete. If your total debt amount is high, it may take you longer to complete the process.
If you are good at negotiating your own debts, debt settlement can be free because you don’t need a debt settlement company to deal with your problems. However, if you appoint a company to solve the problem on your behalf, you will have to pay a fee. Fees are usually based on 25%-35% of your forgiven outstanding balance under this program.
Under a fair deal, you can usually reduce your debt by 40%-60%. Are you saving a lot? Of course! By pursuing a settlement, you can avoid unfair collection practices and lawsuits or legal action.
