Debt Secrets - Is it Possible to Never Pay Back Card Debt?
Debt Secrets - Is it Possible to Never Pay Back Card Debt
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Settlement programs involve three parties, creditor, debtor and the debt settlement company. The debtor and creditor are the end parties and the settlement company acts as a liaison between the debtor and the creditor, trying to negotiate a deal between both parties.
Settlement companies negotiate with the creditor and reduce the debt amount to be paid to almost 50 or 60 percent of the actual debt. The debt settlement firms charge a 25 - 30 percent of the deducted amount as fee. Debtors with a huge debt of 10 grand or more only consult a settlement firm. Consider that the negotiation deal is done with a 40 percent debt deduction from the actual debt. Forty percent of 10k is 4k and 25 percent of 4k is 1k. The debt settlement company makes a very quick 1k by just negotiating a deal.
They offer their services over a wide range of debts including credit card debts, medical bills, gas cards and personal loans. Settlement firms are a huge hit because they are advantageous both to the debtor and the creditor. They help the debtor by help settling the loan with a very small pay back amount and the creditor by getting back something from a bad loan.
The companies which provide loans try their best to avoid bad debts and if it occurs they try and get the maximum payback from the debtor with the help of these settlement companies. Settlement companies are actually designed to serve the debtor and work for the debtors well being negotiating a profitable deal for the debtor. But some companies play a double game by promising loyalty to the debtor and finish the deal with the creditors profit in mind. They collect a heavy sum from both sides for doing this job. If you are caught up with such a company the chances of getting a good deal are extremely low. So it is very much necessary that we rely on a trustworthy settlement company to ensure some good from the settlement deal.
On the other hand loyal firms work only for the client who hires them. Creditors also hire settlement companies to retrieve the maximum possible amount from bad debts. So if their client is the creditor they tend to finish the deal with minimum deductions from the actual debt and it is the vice versa when the client is a debtor.
Debt settlement is a legitimate alternative to filing bankruptcy. Consumers must be experiencing a legitimate financial hardship and have at least $10k in unsecured debt to qualify for most programs. Check out the link below to locate legitimate debt settlement companies in your area for a free consultation.
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