Debt settlement key to Financial Freedom?

Date Posted: June 1, 2021
By: Maggie Marques

Have you been so heavily in debt that you feel there is no hope for tomorrow? With the debt crisis looming over us for years, how can you gain financial freedom and enjoy life in peace? Debt settlement may be the key to your desire to have financial independence.

Debt settlement basics.

Debt settlement is a debt relief option for your unsecured debt. Debt settlement is a negotiation between you and your creditors to get a substantial reduction on the money you owe. This is an agreement you make to pay off a significant amount of your debt in the hopes of your creditor agreeing to write a big chunk off your debt.

If you have a large amount of money to offer, you might be able to negotiate a good deal for your debt. This is possible if you can leverage a significant amount for the creditor to take your offer. So let us say you owe your credit card $10,000; you can ask your credit card company to erase $4,000. If you pay $6,000 (ask for at least a 40% discount at the beginning of the negotiation.).

Debt settlement risks.

There are risks involved when you apply and be approved for settlement. For one, your credit card will be closed once your application is complete. The credit card company may not want to risk having you as their client as you cannot do good with your debts.

Another risk you will face is the adverse effect debt settlement will have on your credit score. If you get a low score on your credit history, you will have difficulty borrowing money.  If you can borrow, the interest will not be the best and lowest.

If these scenarios make you nervous and know you can repay your debts in a few months, why don’t you think about debt relief instead?

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