Requirement for debt settlement
macy
Rep Points: 500
Are there requirements to be eligible to apply for a debt settlement? What were usually the amount ranges from?
I don't know specifics, but I know if your monthly payments exceed or come close to your monthly income then you have a good chance of qualifying.
I know a lot of those debt settlement companies require you to be $10,000 or more in debt. I'm assuming that's because it's not lucrative for them to get involved for any less than that amount. They are like credit repair services...they don't do anything for you that you can't so for yourself.
I don't think there are any requirements. I believe these settlement services are mere consultations. Although you may also ask them to handle your debts for you, you'll probably need to pay them something for it.
It boils down to what the company the debt is with settles for.
thats true, the higher the debtload the more you need help with, right?
I called my credit card companies and made debt settlement arrangements myself. I took debt forgiveness from three companies, but really didn't understand the effect it would have on my income taxes. If a company forgives $5000 in debt, they must report it to the IRS as income to you. You then owe taxes on it. That didn't seem bad to me, but I forgot that this would put my income into the next tax bracket, so I paid a much higher percentage to the government than I thought I would. In retrospect, I shouldn't have done it. I should have raided my retirement account.
i was gong to say the same thing as synthia. you can make the arrangements yourself, collectors do it all the time. if they are desperate for money they may say settle it, pay us now at a dime on the dollar and it will be done.
i didnt know that about the taxes tho, eesh. sorry for you!
[QUOTE=chrissie1101;834]thats true, the higher the debtload the more you need help with, right?[/QUOTE]
well it depends on what kind of debt you have also..
Be smart about your settlements. Make sure you get it in writing. Most collectors will try to beat a payment of anything out of you. They're trying to reset the statute of limitations and drag out the time they have to collect.
Settlement can be done on your own, but if you choose a reputable company, you'll have their experience and knowledge of situations on your side.
