Debt Settlement Relief - 4 Things Consumers Must Know Before They Opt For Debt Settlement

Debt Settlement Relief - 4 Things Consumers Must Know Before They Opt For Debt Settlement

Debt settlement relief is probably on the mind of all those Americans who are a victim to the imminent economic recession. The slowdown has taken a toll on the jobs of thousands of people. In these circumstances, debtors run from pillar to post to reach a remedy to their financial problems. If you are knee deep in debt, you may have been advised to visit a debt relief network, to seek the assistance of a settlement company and find a solution to your debt related issues. Before you step ahead, you must have the knowledge of a few important things about debt settlement.

Four things a consumer must know before he opts for debt settlement are:

1. The option of settlement is available only for loan defaulters. A bank has no good reason to agree to a loan settlement with a person who pays his monthly installments, religiously. If you want to persuade a bank to grant you rebate in the settlement of your dues, you must stop paying your monthly installments, right away.

2. Debt settlement relief is open to a person whose total unsecured debt is more than $10k.An expert in financial matters can secure a rebate of at least 40% and up to 70% from the credit card company.

3. Obtaining a discount from the credit card company is not a cake walk. People hire professional help because it involves a lot of skill to convince a creditor about the poor financial status of the debtor. Only when the creditor is assured that you have no alternate resources to return the money, will he agree to debt settlement.

4. If a person files for bankruptcy, the credit card company will lose out on the entire unpaid loan amount. Debt settlement is a ray of hope for the creditor that they will get back a part of the total loan amount. The government provides bailout packages to financial institutions to encourage them to stay in business. This makes up for the loss of the company. It is the tax payer's money that is being used to revive the economy. Hence; you should not hesitate in making the maximum use of this opportunity.

Debt settlement is a legitimate alternative to filing bankruptcy. If consumers are experiencing a financial hardship and have at least $10k in unsecured debt then debt settlement can be a legitimate way to eliminate up to 70% of that balance.

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