A lot of people find themselves in a situation where they are getting more and more in debt and don't have nearly enough money to pay their monthly bills. People who are having trouble paying their bills have no choice but to find the best way to get out of debt and stop worrying about money. Many people end up at debt settlement, which has been getting more and more popular over the past few years.
There is, unfortunately, a lot of bad information out there about how debt settlement works, so if you're thinking about going this route, it's important to be well-informed. For example, I recently read an article whose author said that if you pay your agreed-upon settlements in full, you'll have a "good credit rating." The author should have gone on to say that, yes, your credit score will get better, but only after your credit report shows that you have paid off all of your debts. This doesn't happen right away; it can take a few months. I'm in favour of debt settlement for people who are close to filing for bankruptcy, but I also think it's important to get all the facts before making a final decision about how to handle your credit accounts.
I also recently found some information that turned out to be completely false. One author says that debt settlement companies can get your creditors to "re-age" your accounts so that they look like they are current. This just isn't true, and it never has been. Debt settlement companies just talk to your creditors and try to get them to settle your accounts for less than the full balance, usually 50% or less. During the debt settlement process, there is no need to re-age the account, and creditors will not agree to do so.
I'm sure you've heard about the effects of debt settlement, like having to pay taxes and having your credit score go down. Both of these things can happen, and you can find out more about how debt settlement affects income taxes by going to http://donaldsonwilliams.com/Debt Settlement And Income Taxes.html. Visit http://donaldsonwilliams.com/Debt Settlement and Your Credit Score.html to learn more about how debt settlement will affect your credit score.
Before jumping into a programme you don't know much about, it's important to do enough research to be well-informed. This will give you a sense of relief. There are a few debt settlement companies that don't ask for big fees up front or even monthly payments to a trust account. These same companies will work on a contingency basis, which means that you don't have to pay for their services until you and your creditor have reached a deal that you are happy with. Be wary of companies that seem more interested in getting your money than in helping you solve your money problems and get out of debt in a legal way.
