Collecting Your Debt - What Debt Collection Agencies Don't Want Consumers to Know

Collecting Your Debt - What Debt Collection Agencies Don't Want Consumers to Know

Debt can be very annoying for both parts, for the consumer and for the lender. If you take a loan and you can't afford to pay it back the first month you will have to pay extra penalties in the next month, obviously it would be hard and will get harder each month you miss a payment. Also due to high interest, a credit card loan is hard to pay back and so many consumers are now in debt; the recession and the bad state of the economy doesn't help the situation and even more and more consumers end up in debt.

Debt settlement will make the creditors reduce your debt after some easy negotiations made by a professional debt settlement company. You may wonder why would the creditors accept a reduction of 50% in your debt, it doesn't seem like the best decision on their part but there are things that you should know, things that the credit card companies don't want you to know.

Once you miss a payment you suffer penalties but once you miss several payments, the credit card company is forced to give your debt to collection agencies for a percentage of that debt. This causes the creditors to lose an important amount of money and you will be stressed by the collection agencies which will make harassing phone calls on a daily basis. They will tell you to pay back your debt and they will go as far as telling you to sell your belongings so that you can afford to pay back the creditors. Never listen to collection agencies and don't sell what you own, a credit card debt is an unsecured one and so the creditor or the collection agency has no right to come and take your belongings or make you sell them.

Some debt settlement companies promise to stop the phone calls from the collection agencies as soon as the debt settlement process begins. Collection agencies don't have any leverage over consumes with debt and all they can do is make annoying phone calls every day, some consumers don't have any problem with this while others find it unbearable.

Debt settlement is a legitimate alternative to filing bankruptcy and often makes sense for consumers on the verge of bankruptcy. There are also other debt relief options available so it would be wise to speak with a debt relief specialist to go over your different options.

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