Eliminate Unsecured Debt – How to Avoid Bankruptcy and Negotiate a Settlement
Most consumers are unaware of the fact that they can attempt to eliminate unsecured debt. They are simply ignorant of the fact that credit card companies do negotiate if it is beneficial for them. You can convince them to eliminate your late charges, reduce interest rates or excuse you from paying annual membership fees. If you are unable to make your regular payments, they also agree to settle by letting you pay less than the actual amount. When a debt collector gets back to you saying their policies do not allow debt settlements, just don’t give up persuading. It doesn’t matter if there is a lawsuit already filed or the account is in collections.
Try to eliminate unsecured debt keeping in mind that credit card companies survive in a very competitive market. These companies also value their clients, as obtaining new clients is always tough. If you have been regular with your payments, go ahead and re-negotiate the initial terms mentioned in your contract.
However if you are already lagging in payments and are in no position to pay back the amount you owe, debt settlement is a good idea to eliminate unsecured debt. It can save you from filing bankruptcy and you can negotiate and pay off your debt by reducing your debt amount as low as possible. Another important tip, the longer your account is in collections, the better are your chances to negotiate effectively! Credit card debts are most common form of debt settlements. But even bounced checks, medical bills, personal loans, etc. are eligible for settlements.
It is easy to get a debt settlement if the debtor can afford to pay 30%-60% of the total amount. If you want the creditors to settle for any amount that is lesser than the total, it is advisable to offer it in lump sum. If you own a home, you can opt to refinance and use the home equity for settling the debt. Or you can sell some other asset; borrow the money from a close friend or think of some other suitable alternative. In case you cannot raise the money immediately, don’t think it impossible to eliminate your unsecured debt, as your creditors may let you pay the negotiated amount over a certain period of time.
By: Sankalan Baidya
Tags: Checks, Collections, Competitive Market, Consumers, Credit Card Debts, Creditors, Debt Collector, Debt Settlement, Debt Settlements, Debtor, Filing Bankruptcy, Home Equity, How To Avoid Bankruptcy, Initial Terms, Interest Rates, Lump Sum, Medical Bills, Membership Fees, Personal Loans, Unsecured Debt