Posted on July 31, 2009 at 12:10 am I heard that debt negotiation and arbitration can really eliminate debt. How true is this and what is it all about?

Posted on July 31, 2009 at 1:14 am Two terms: debt negotiation, this usually pertains to credit counseling and debt settlement. Arbitrtion: is a separate trial or a supplemental trial (not considered a major trial) in a bankruptcy case. However, arbitration is also known as debt negotiation in the debt settlement industry.It's true that it can eliminate debt but of course it all depends on the circumstances of your case. Are you in need of a debt relief service?

Posted on July 31, 2009 at 1:41 am I agree with x and y, debt negotiation and arbitration are the same things, it pertains to debt settlement, in fact one of the things that a consumer should look for in a debt settlement company is its membership with IAPDA (International Association for Professional Debt Arbitrators).

Posted on July 31, 2009 at 1:50 am No I don't need a debt relief service as of yet I am just curious. Thank you for your replies, one more question, do debt settlement companies have lawyers? Isn't arbitration a legal term as x and y has mentioned--what necessitates an arbitration? I mean even if it refers to the same thing which is debt settlement, surely there is a difference between a simple debt negotiation and an arbitration..

Posted on July 31, 2009 at 2:02 am Okay I'm not a lawyer but this is what I know, debt negotiation is a form of a debt arbitration- and it is applicable to consumers who have defaulted on their payments (for three months usually). They are considered delinquent by the creditors. At this point the creditors have probably already exhausted their collection means and believing that the consumer has no intention to pay -would then bring a lawsuit against the consumer. The goal is to obtain a judgment.It means that the consumer's account has gone legal. Debt settlement companies often have legal advisers for such cases.

Posted on July 31, 2009 at 2:07 am So in a way, debt negotiation is for simple cases like the consumer having a $10,000  worth of credit card debts and has already defaulted on it. He/she enrolls in a debt settlement company to have that debt reduced to up to 75% After 12-36 months of debt settlement program, the consumer gets either a "paid" or "settled" mark on his/her credit report. The term debt arbitration, on the other hand, is more appropriate, I guess, when the consumer fails to enroll in a debt settlement program before the creditors filed a judgment lawsuit against him/her.

Posted on July 31, 2009 at 2:09 am Somebody mentioned bankruptcy. Would you consider it a form of a debt negotiation and how does arbitration figure into a bankruptcy case?

Posted on July 31, 2009 at 2:23 am In a way bankruptcy is a form of a debt negotiation, especially if it is a Chapter 13 case, because the participants attend what they call the creditors meeting. On there, the consumer proposes a repayment plan, and the trustee and the creditors must first approve, before it reaches the judge of the case. So in the creditors meeting the negotiation of the repayment of the debt is the topic of the discussion.

Posted on July 31, 2009 at 2:34 am Arbitration in an ongoing bankruptcy case happens when a consumer (who's been served a judgment), seeking the automatic stay protection of bankruptcy, filed bankruptcy to stop the creditors from further executing any of the judgment consequences (wage garnishment, bank levy, property lien), got his/her bankruptcy approved, found out that the creditors are still (for example) garnishing his/her wages, the creditors not wanting to suffer the consequences of the violation of the automatic stay provision files a kind of a motion to stop or stay the litigation against them, the judge orders that the issue be resolved in an arbitration court, not in the bankruptcy court.And I think in the arbitration court, debt negotiation will happen, and perhaps even a debt settlement.

Posted on July 31, 2009 at 2:38 am If iamfyodor is correct, what happens is that debt negotiation comes in the consumers case in an inverted manner. When the consumer failed to negotiate his/her debt before the creditors filed a lawsuit, the lawsuit provided a way for the consumer to negotiate his/her debts inside the arbitration proceedings. I do not recommend letting the situation go that far. So if any of your friends need a debt relief solution, please invite them to fill out a form here at destroydebt.com so they can avail of the free consultation.