Monday, March 19, 2012

Avoid Bankruptcy With Debt Negotiation Help | Online Success Articles

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Copyright ? 2012 DebtSettlementHelpSite.com

Is debt destroying your life? Are you cannot repay what you owe? Are your monthly lowest payments draining your income and stopping you moving forward from paying off the balance of what you owe? If you may answer yes to these questions, and if you believe bankruptcy is wrong for you (or you do not qualify), you might need to choose debt settlement help.

What is debt settlement help, and how does it work? Debt negotiation is a type of financial settlement where consumers bargain with their creditors. The objective for a customer is to be released from a big part of what she owes, while the objective for her creditors is to get as much of the debt as possible in one lump sum. In a typical settlement, the consumer agrees to pay between 40-60% of what she owes in one lump sum, while her creditors agree to release her from what remains. The debt settlement business is thriving like never before, with debt settlement help available everywhere. More customers have come to see its value as a means off the so-called ?credit treadmill,? while more lenders have come to see it as a way to get back some of their money instead of losing all of it in bankruptcy or collection lawsuits. For customers it represents an escape from the so called ?credit treadmill?; for creditors, it offers a very reliable technique to collect a substantial part of their money, as opposed to seeing it all disappear in bankruptcy or collection proceedings. And with new federal rules put in place over the past 2 years, debt settlement is now a much more dependable business.

The credit treadmill is a situation where a consumer is stuck making never-ending minimum monthly interest payments on his debts, draining his earnings and keeping him that a lot further from paying back the outstanding balance. The only way off often seems to be Chapter 7 bankruptcy, which damages credit ratings ? assuming it is even available, which for a lot of consumers it isn?t. Debt settlement help might be a better option.

Debt settlement companies sadly have something of a bad reputation. For several years it was an unregulated sector, and disreputable companies were able to charge hefty up front fees, then do nothing to reach settlement agreements for their customers. Unethical organizations also kept customers in the dark about the potential risks of debt negotiation.

But in 2010 the Federal Trade Commission adopted new amendments to its Telemarketing Sales Rule, which applies to telemarketing and similar procedures. As long as debt settlement help is sold over the phone (including sales made in reply to calls from customers), settlement companies can?t charge fees before reaching settlement agreements that decrease their clients? debts. Also, they are banned from front loading fees and charging customers more for first negotiations than for subsequent settlements, an arrangement which would create an incentive for unethical companies to expend all their efforts on one settlement per client.

Settlement companies are also required to reveal the likely length of negotiations, the cost, and potential risks. For one thing, credit ratings generally suffer from debt settlement, though bankruptcy normally causes worse damage.

Not all customers use debt settlement help; many try to negotiate on their own. They often run into a problem, however: They just do not have much bargaining power, in contrast to settlement companies, which do business with creditors all the time. Negotiation companies also have a leg up in dealing with creditor bureaucracy.

Al Prise is a practiced veteran in the financial debt settlement world. His web sitehttp://DebtSettlementHelpSite.com is a clearinghouse of resources, articles and suggestions on how to settle credit card balances. If you are looking for debt settlement help, he will also procure genuine offers from your lenders with no up-front fees.

Source: http://online-success-articles.com/avoid-bankruptcy-with-debt-negotiation-help/

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