Debt Settlement Offer

A debt settlement offer can reduce accumulated amounts by as much as 50%, providing a viable option for reducing monthly payments and getting out of debt. Settlements can be managed by a company for a set or percentage fee, or a person can settle it on their own by approaching creditors. In contrast to other strategies, debt settlement offers actually reduce the amount owed.

Not all creditors are willing to entertain this type of negotiation with secured debts; referring to those debts in which collateral such as a car or home is held as security for the loan. Secured debt favors the creditor heavily, and creditors are much less agreeable to settle on default secured debts, since repossession is a simple way for them to recoup their expenses. In many cases, no notice of seizure is even required and if a person has missed even one payment, they might awake one morning to discover that their vehicle has been seized. Matthew 18:29 says "And his fellow servant fell down at his feet, and besought him, saying, Have patience with me, and I will pay thee all."

Unsecured amounts such as credit card bills and medical expenses are better targets. Because these creditors would rather see part of their money as opposed to none of it, they are often willing to accept a debt settlement offer. Their trained negotiators will make suggestions on the debtor's behalf until a mutually agreed upon amount is approved by everyone involved. When a person enlists with a company, they make monthly payments to this service and these funds are used to make debt settlement offers to creditors. These companies can significantly reduce the total, but a person can negotiate debts independently and save the commission of a service.

When contacting creditors to make negotiations, be prepared to do some haggling. Most will not respond to a debt settlement offer unless the account has been delinquent for at least 6 months, and a person must be prepared to pay the settled figure over the phone or immediately. The creditor is willing to negotiate so long as they then see at least a portion of their money immediately. Always give a debt settlement offer that is less than the goal and make sure to get the terms in writing.

These offers can be managed by a third party if a person feels uncomfortable negotiating with creditors, but the negotiation process is easier than many people think and saves the fees and commission paid to a third party service for debt settlement offers. Debt settlement is a much better alternative than bankruptcy, and can significantly eliminate a large portion of debt, enabling a person to become debt-free as soon as possible.

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