Stop Burning Your Money
As the number of Americans who lose sleep over credit card debt continues to rise
, so does the need for an effective solution. Those with over $10,000 in credit card debt feel as though they're literally taking a lighter to their hard-earned money each month as they continue to make minimum payments with little progress toward lowering balances.
If you can relate to this scenario, you need to know that bankruptcy is not the only light at the end of the debt tunnel. In fact, bankruptcy should be avoided at all costs as it severely damages credit for up to ten years, making it difficult to maintain a successful business or consumer life. Rather than defaulting to bankruptcy, consider debt settlement as a viable debt relief option.
Debt settlement is a legal and ethical way to reduce unsecured debt for a fraction of what was originally owed. Settling debt in this fashion involves negotiating a lump sum payment with your creditors that is hopefully between 40-60% of the original amount owed. As with anything else in life, it is vitally important to research any company you might use to settle your debts. Not all are created the same, and many are outright scams.
So how do you separate the 'good' from the 'bad' and the 'ugly?' A general rule is to keep your business away from any company or lawyer who collects fees before actually settling one of your accounts. Though it may be tempting to want to just hand off your debt to anyone who makes excellent promises, this will be a costly mistake if you fail to do adequate research.
In fact, choosing a reputable company is so important that the FTC has issued new regulation to help clean up the debt settlement industry. As of October 27th, 2010, it is illegal for debt settlement firms to collect any upfront fees before they actually settle at least one of your accounts.
Though reading of new regulation may put many consumers at ease when beginning to search for a legitimate company, consumers should also beware of unscrupulous debt negotiators who plan to take as many clients as possible before the October deadline, only to leave them in the dust when the company is forced to close its doors.
In light of this potential pitfall, debtors in search of relief should look into a company's history. Consumers should ask many important questions to make sure they are in safe hands. Find out how long has the company operated without collecting any upfront fees, whether or not they are accredited by the Better Business Bureau and are a member of The International Association of Professional Debt Arbitrators (IAPDA), or other accredited associations of professional debt arbitrators.
Further, companies should also be realistic with clients. Sometimes, debt settlement is not the best for every debtor. In many cases, bankruptcy is the most viable option, and a legitimate debt settlement company will advise a potential client in this direction, rather than stringing them along. Though navigating your way out of debt is challenging, it can be done. If you find the right company, debt settlement can in fact increase your cash flow, help you reduce debt, and get rid of the guilt of essentially lighting your money on fire each month.
by: Aliceshown
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