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Debt Destroy

Reducing Debt Fast Bailout

Millions of consumers are struggling each day to pay off high interest debt, with many of them falling farther and farther behind each month.  While it would be ideal if there was some sort of "magic" solution to this problem, the truth of the matter is this: each person is responsible for figuring out the best process for eliminating their high interest debt.  There is no bailout in sight for consumers, therefore you must closely examine the options that are available to pay off your debt balances and move on with your life.  One of the popular debt relief options available today that is often confused with some sort of government "bailout" is debt settlement.  The mix-up appears to be the result of some advertising that tends to lead consumers to believe they are enrolling or participating in a government sponsored program.  Here we take a closer look at debt settlement and how it can help you eliminate debt. 

Debt settlement, sometimes referred to as debt negotiation is a legal process which may cut your debt in half.  Unlike debt consolidation or debt management plans, this process does not involve paying your creditors each month, instead you set aside a predetermined amount of cash each month to be applied toward future settlements. When your accounts are delinquent, creditors are often willing to negotiate or settle for a reduced payoff amount, which can reduce the amount of money owed by 50-70 percent.  This process, while often successful, is not one that comes without risks.  There are no guarantees that the creditor will be willing to negotiate and there are several factors that determine if they will consider a reduced payoff amount and if so, how much you will save.  In the meantime, your balances will continue to rise due to late fees and other penalties applied to the account.   

Anyone considering debt settlement should also know that this process should be considered as a last resort before filing for bankruptcy.  Despite the fact that debt settlement can reduce your debt, there are situations where the consumer may end up owing more money or worse face legal ramifications for delinquent accounts.  With this in mind, you may be wondering why anyone would assume these risks with no guarantee of success.  The answer is simple; this process is geared toward consumers who have already fallen behind on monthly payments or are about to as a result of a financial hardship.  It is not recommended for consumers who have the ability to repay their debt, even if only through minimum payments. You must demonstrate a true financial hardship and the ability to pay something toward the account to be considered for debt settlement.  Your credit will take a hit in the short term, however if you are successful in settling your high interest accounts, you have the opportunity to move forward without the burden of thousands of dollars of debt.   

Remember that debt settlement companies are in business to make money.  Unfortunately the industry has several companies that have not been forthcoming or honest in how they handle consumer accounts, therefore you must do plenty of research in order to determine if the company you are considering is able to help you versus cost you more money in the long run.  There is no easy solution or "bailout" for consumers in debt, however you can put forth the effort to make informed decisions as to how you will eliminate your debt.


Kairon - The debt settlement option available through the creditor arbitration process is a much better alternative as compared to filing for bankruptcy under Chapter 13. In many ways, the debt settlement facility can be compared to Chapter 13, since a percentage of the debt is "paid" while the remaining balance is forgiven by the creditor. The unique difference is that debt settlement is generally a "private matter" and very much under the control of the "debtor", whereas filing for bankruptcy under Chapter 13 is a "formal" process and is guaranteed to appear on "public record".
debtfreedaniel - Even we hire these debt settlement companies to help reduce our debt, it is still upon us to have that discipline to minimize our expenses and keep it within the level of what we can afford. Debt settlement companies are not in there for non profit thus you also pay them to help you out.  Daniel
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teal (Guest) - You’ve done everything you can to get out of debt, but just can’t seem to dig out of the hole. Your only option is to settle.
Ronald Eddy (Guest) - Its good you are sharing your views with everyone..good advice