When should people consider the option of debt settlement to pay off the debt?
After the recent unfortunate recession, a large number of individuals across the nation are not getting a job and thus, are not being able to pay for monthly bills. Therefore, the bills get piled up and become impossible to be paid off, results in incurring an overwhelming debt. So it is to be said that debt has become one of the most common financial obligations, coming out of which people are looking for a way to earn cash and settle debt. They are relying more on the internet as a reliable source of earning cash. Many of them are starting up a business of internet marketing to earn cash and settle debt. Before starting a business, they are doing an extensive research on how to get traffic to their sites and increase the cash flow. However, that’s not enough to settle the debt. So, people need to understand whether debt settlement is the right option for them.
When is the right time to settle your debt?
Following are some of the situations when people should consider debt settlement.
Getting frequent calls from creditors?
If you are getting frequent calls from creditors regarding debt collection, consider settling the debt with the help of an attorney or a professional negotiation firm. Once you hire the services of a debt settlement lawyer, the creditors or debt collectors are prohibited from contacting the debtors regarding debt collection. Rather, they should deal with the lawyer regarding any debt collection issues.
Unable to make monthly payments:
If you are not being able to pay your debt for last 3 to 4 months, debt settlement is apt for you. Creditors will not accept the settlement offer unless you lag behind your payments for last 3 to 4 months. So if you are into payment problems for a last couple of months, go for debt settlement.
Mounting debt problems:
If the outstanding balance on your debt is incessantly mounting high, pursue debt settlement. Debt settlement is a process that helps you reduce the debt amount by lowering the outstanding balance by upto 50 to 70 percent. Thus, with debt settlement, the debt amount comes down so as to help you come out of debt fast.
Getting a lawsuit threat:
If you are getting a lawsuit threat from creditors, enroll in a debt settlement program. When you hire the services of a debt settlement program, credit counselors or negotiators deal with creditors to prevent a lawsuit. Negotiators or counselors can do this better as they are equipped with all the legal knowledge.
You can repay if the debt is reduced:
If you think that you can repay your debt if it is reduced by quite a few percent, pursue debt settlement. That is because debt settlement lowers the outstanding balance on debt to make it easier for debtors to pay down the debt. Furthermore, it offers you a payment plan based on your unique fiscal situation. You can repay the debt either by making a lump sum amount or by making several monthly payments.
Thus, these are a few situations when you can consider the option of debt settlement to pay off the debt.
This article has been contributed by Diana Degarmo, a contributory financial writer associated with Oak View Law Group. She has made significant contribution through her articles on different debt related issues like debt settlement, debt negotiation, bankruptcy etc. She likes to keep updating herself regarding recent developments in the finance sector.