The average family in the U.S. has $8,377 in debt. That kind of debt can be stifling for families. That’s why many choose to hire a debt settlement company.
Debt collecting is an essential tool used by businesses to try to get the money that they are owed from individuals. Thus, debt settlement is in high demand. As a consumer in debt, how do you know what to look for when trying to find the right company to negotiate your debt issues?
Here are 3 things to consider before you start working with a professional debt settlement company.
- What Type of Debt Do You Have?
Before you start the process for obtaining your financial freedom, you’ll need to determine what type of unsecured debt you have. Typically, only unsecured debts qualify for a debt negotiation program.
Unsecured debt is debt that is not “secured” by collateral, such as a home or automobile. Credit card debt is the most common type of unsecured debt. Other types of unsecured debt include medical bills, personal loans, gas cards, computer loans, pay day loans and furniture store loans to name a few.
- Get Educated in the Field and Know Your Rights
When searching for a debt settlement company, it’s important to get a general knowledge of the field and what a negotiator will do for you. Of upmost importance is checking out their background and track record.
An experienced debt settlement company will know your legal rights to avoid harassment and other illegal practices.
Additionally, some debt settlement companies will charge you money whether they resolve an account or not. Look for a company that doesn’t ask any upfront fees and only charges you if they settle an account.
It’s also important to be familiar with the Fair Debt Collection Practices Act to ensure your rights are maintained.
- Look for Proven Negotiating Skills
Debt settlements usually involve negotiations between the consumer and his or her creditors to resolve unsecured debt for less than the full balance. Rarely are debt solutions the same for everyone. Look for a company that will develop your own debt management plan.
An experienced, trusted debt settlement company will first look at your income and total debt to develop a plan that works for you and your budget. You begin by agreeing to set aside a specific amount of money each month into a separate savings account set up for you. Then this money will be used to negotiate settlements on each past due credit account you have as you build up the savings.
Once a settlement is reached on an account, the negotiator will present that offer to you and together decide how to accept or reject the offer. This process is continued until each debt in the program is resolved and your past due accounts are each paid off.
There are many factors that contribute to the settlement of an account; therefore, do not trust someone who guarantees specific outcomes of your accounts. Instead, look for a negotiator that can diffuse a tough situation and effectively communicate with debtors and debt agencies to secure the right, manageable plan for you.
It’s Never Too Early to Get Started With Debt Settlement
There are no magic solutions to resolving debt, but you can find a program that will allow you to gain control of your finances and resolve the debt you currently are dealing with. Contact us today to learn more on what we can do for you.
The Effective Legal Debt Solutions team is comprised of caring, seasoned professionals with years of industry knowledge coupled with personal real-life experience of dealing with debt settlement situations that many of our clients are facing today.