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Debt Settlement: DO IT YOURSELF (DIY) On your own!

Published by admin on December 18, 2009

Debt Settlement: DO IT YOURSELF (DIY) On your own!

Debt settlement is a good alternative to bankruptcy for many consumers that are struggling with high credit card debt. In most cases, consumers will hire a professional debt settlement company to work with their creditors and to pay off their debt at a reduced amount. Fees often range from 15-25% of the amount saved. These fees are considered to be more than decent if you take into consideration that these settlement companies are able to help you get out of debt.

But do you have to pay to settle your current debt?

For most people, it is a good idea to hire a professional company. There are several reasons:

1 – Creditors usually treat the professional debt settlement companies more seriously.

2 – They often have relationships with creditors and they are able to get you a better deal.

3 – While the process is not difficult, it’s going to take some time, effort and patience.

However, if you’re ready to take on this task by yourself, here are some tips to help you through the process:

• Understand that you have to treat a debt settlement process just like a negotiation – you must give something in order to get something.

• Just because you think your offer a good deal, does not mean that the person you negotiate with will think the same as you. So, this means that you will have to offer more, before you can actually find something that is going to be good for both sides.

• Many people think that the protection of their credit score is a key point – but the objective of debt settlement should be getting out of debt (why would you discount a creditor and a good credit? You can try, of course, but do not be surprised if this is part of the offer is not accepted).

• In most cases you have to pay one lump sum, no payments (see first item above). So you should have some reserve money.

• If you are already behind your payment, you will need to stop making payment for leverage. After all, why would you discount the creditors, if you are paying on time? Take that money and save for your settlement payments.

• Finally, be patient. Negotiations may take some time. But the more you try; you will get a better deal.

If this does not sound like something you can do yourself, you should seriously consider hiring professional debt settlement companies.

Otherwise, get ready to roll your sleeves up to a few phone calls (the letters are not as effective) and it is time to start the negotiations!

Start by making plans for using your money the smart way and save money in order to avoid getting into credit card debt again!

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