Debt settlement is purely based on negotiation with the credit card companies to eliminate or reduce the total amount of debt for payment. You can either do it on your own or take the help of professionals to negotiate on your behalf. You might try calling up your credit card company asking for a waiver on interest rate or the charges applied to your credit card. Explaining your willingness to pay the debt but inability to pay the whole amount due to lack of sufficient means might convince the creditors to reduce a significant portion of the total amount due.
However, at times the lenders find it difficult to believe an individual and his proposed plan of settlement, especially if his credit history shows an inconsistent payment in the past. Under such circumstances it is worth referring a debt settlement firm. These firms generally start with your financial details and use their softwares or tools to calculate the amount of debt you can possibly pay over a period of time. They tend to collect information related to your expenses, liabilities, households, assets and the secured as well as the unsecured debt.
The settlement program starts with accumulating the monthly payments in an escrow account. This is done to stop paying to the creditors directly for a certain period for two purposes.
* To create a background for negotiation, when lenders receive absolutely no payment they might be interested to know the reason and keen to agree for settlement
* To collect sufficient amount to offer the credit card companies with a lump some payment during negotiation.
Using this tactics, the settlement firms negotiate with the creditors on your behalf to eliminate 50-70 percent of the debt.
A legitimate firm would be accredited by Better Business Bureau and be associated with one the settlement organizations such as USOBA or TASC. They use their experience and expertise to negotiate the settlement. Years of practice and experience in the industry help them establish strategic relation with the credit card companies. The latter also tend to believe the debt settlement firms more than an individual when it comes to negotiation.
Finding legitimate debt settlement companies is not that difficult but consumers must know where to look. It would be wise to utilize a debt relief network that will qualify the companies for you and ensure that they are legitimate and have proven themselves. To locate the top performing debt settlement companies in your state check out the following link:
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