Debt Settlement
If Bankruptcy doesn’t fit your financial goals, you still have other options to eliminate your debts. Debt settlement could be a way to solve your debt problem without Bankruptcy.
What is the difference between Debt Settlement and Debt Consolidation? Debt settlement is if creditors agree to accept less to consider a debt “paid in full.” In theory, Debt consolidation is making one payment to cover all your debts. However, consolidation usually requires getting a loan to repay your debts or settling them at a discount.
But this is the catch – companies that offer “debt consolidation” aren’t lenders. Your state government licenses every Lender, and this business is highly regulated. But debt consolidation companies do not want the government looking at them too closely. So instead, they offer debt settlement which they disguise as debt consolidation. This sleight of hand has an essential purpose – to make them more money, to hide from any responsibility to their customers, and to make repaying your debts impossible. So while you believe your payments are going to your creditors, your payments are only paying the fee to the “debt consolidation company.” Debt consolidation companies don’t begin negotiations to repay your debts until you pay their fees in full and have money on deposit to pay out a settlement. As a result, people often make payments for years. While this takes place, these debt consolidation companies do nothing to earn their hefty fee.
How Does Debt Settlement Work?
Large debt settlement companies focus on assisting people with credit card debts and debts that have been turned over to professional debt collectors.
Each method of debt relief has advantages and disadvantages. At A Fresh Start, we recommend you keep an open mind and consult a debt settlement lawyer who thoroughly understands bankruptcy law. At A Fresh Start Law, Attorney Dorothy Bunce can answer your questions so that you understand your options before you make this decision.
Can All Debts Be Taken Care Of With Debt Settlement?
Is Debt Settlement a Good Idea?
How Long Does Debt Settlement Take?
Advantages of Debt Settlement.
- Stops creditors and collectors from harassing you.
- Avoids Bankruptcy.
- It could reduce your debt.
- Keeps your financial information private.
Disadvantages of Debt Settlement.
- Creditors may refuse to negotiate.
- Because of interest and late payment fees, you may have more debt than you anticipated.
- You may have to pay taxes on the amount you save by settling your debts as if you earned it as income.
- Your credit may suffer due to settling your debt.
Speak with a skilled debt settlement lawyer at A Fresh Start Law today.
Is Debt Settlement Right For Me?
Your chance of success will increase if you hire an attorney who knows the ropes and knows those working for your creditors. Is debt settlement the ideal option to get your debt under control? Before answering, at A Fresh Start Law, we will first analyze your circumstances. If you are not likely to be able to afford to settle your debts, we will tell you this. If you expect unrealistic results, we will also explain why. Choosing debt settlement is an important decision. Because one size does not fit all, the team at A Fresh Start Law suggests considering many factors before making a final decision.