Have a Debt Free Life With Debt Settlement

Debt Free Life With Debt Settlement

Debt settlement can be considered as a debt reduction process. It is an opportunity for you to settle your total outstanding balances at a lesser amount. The most challenging part in the settlement process is the negotiation with creditors. Sometimes, it is quite hard to convince the creditors to accept the proposal. However, in order to eliminate your debt faster, you should give yourself a try.

Here are some useful steps you can take to achieve your goal.

Step 1:

Accumulate all your debts and list down all the interest rates involved. At the same time, assess your financial position carefully. Determine the maximum amount of money you can afford to pay to cover your total debt. In general, many creditors agree to settle bad debts at the rate of 50%-70% of the total outstanding balances. Step 2:

Allocate funds for settlement. You are reminded to make sure that there is sufficient fund in your saving account. In general, the creditors will require their debtors to make payment immediately once the negotiation process is completed. Hence, make sure you are financially ready before contacting your creditors.

Step 3:

Call up your creditors to deal with them. You can also write in letter to them if you don't have confidence to negotiate verbally.

Step 4:

It may take months to negotiate. Once you obtain the approval from your creditors, request a black and white letter from them. You are reminded not to make any payment if you don't receive any written consent.

Step 5:

Send a check to your creditors and request them to update your credit report. Follow up closely with them to ensure that your account is closed and your debt has been paid in full.

Although not all creditors will accept the settlement offer easily, with great patience and powerful negotiation skill, you can definitely overcome all the hardships.

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