Debt Settlement StrategiesWritten by Jill Morrison
Debt settlement is an excellent strategy for eliminating debt in a timely manner. Some people become so overwhelmed with debt that they give up on solving their debt problems. Some may even suffer from depression, though anxiety is a more common reaction to major debt problems. Debt settlement is considered by many to be the most effective option for paying off large amounts of debt and relieving stress caused by debt issues.
Using Debt Settlement as a Financial Strategy
Debt settlement is a popular option for relieving debt issues because it can help to drastically reduce debt totals. The first step in debt settlement is consolidating all debts into one total amount. Debt settlement companies can then negotiate with creditors and financial institutions to reduce this amount. Debt settlement can cut individual monthly payments by as much as 60 percent.
Debt settlement companies are also desirable because they can reduce pay-off times by up to 70 percent, waive all extra fees and charges, and drastically reduce interest charges. Because debt totals are reduced considerably, debts can then be paid off much more quickly than they could if debt settlement services were not used. Debt settlement also helps to end harassment from creditors, attorneys, and collection agencies.
Debt settlement can only be used for unsecured debts, including debt from credit cards, medical bills, collections, auto repossessions, and any unsecured loans. Debt settlement cannot be used for secured types of debt. Secured debts may be accumulated from student loans, government loans, lawsuits, utility bills, child care, alimony, auto loans, or the IRS. Debt settlement is a great strategy for getting rid of debt once and for all, but those who go through the process must be willing to change their credit habits to avoid similar problems in the future.