subject: Problems With Some Debt Settlement Options [print this page] If you're like many Americans who've experienced financial setbacks due to the effects of the recession on your nest egg, you may also have encountered problems such as accumulated debt. While some recommend that you address your debt and resolve it by yourself, there are others who'll tell you to go to a firm or company that specializes in debt settlement. While both may seem like logical options, it's more likely for you to efficiently remedy the situation with the professional and legal advice a finance lawyer can give.
While the D.I.Y. approach can seem too difficult for many seniors, the debt settlement services from a company may appear shady and result in more problems than you started with. With financial attorneys, well, the legal bills may not be practical if you're in real financial trouble. In your search for an alternative to filing for bankruptcy and hiring "experts" from a debt settlement firm, you'll have to understand a few things, such as the risks and expenses associated with these actions.
When it comes to creditors, you'll need to realize that lending is a business - it requires logic. They'll be much more amenable to restructuring your loan payments by lowering interest rates or increasing the payment duration, among other methods of loan modification. The last thing they want is for you, the borrower, to file for bankruptcy, after which they won't get anything at all.
This is the reason why a number of companies may even agree to forgive a part of what you owe them if you can pay some part of it. After this, your debt may be as good as settled - with the creditor and the credit bureaus as well. The problem with this option is that while you won't have a debt balance, your history, including payment problems, will remain in your credit report. You'll still have to fix your credit score afterwards.
by: Carina Smith
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