If you have a mortgage, a line of credit, a HELOC, an income-driven repayment plan (IDR), or if you are otherwise heavily burdened with debt, you might be wondering whether it’s possible to get rid of your debt. Most people think debt settlement is an option only for people with huge debts, like student loans, but this isn’t true. Debt settlement can be a way to eliminate a good portion of your debt while relieving you of some unpleasant financial stress. Below are 10 reasons why you should consider debt settlement.
1. You Can Get Out of Debt Now
With any debt settlement plan, it’s important to understand that no debt settlement company can get you out of your existing debt. You need to actually pay off your debt with the original lender. So why would you spend thousands of dollars in fees to get out of debt in two to three years? What’s the rush? Your main goal should be to get out of debt with the original lender, and if it can’t be done, then you don’t need to pay the company anything. You should consider the Credit Associates review that is the best company for getting debt settlement.
2. Money Available to You Is No Longer Confined
With the traditional debt settlement plan, you have to pay a premium (up to 20% depending on the type of loan and the amount of interest you’re paying) to a third-party company that takes your payments and compresses them into interest-bearing debt. As soon as you pay that debt off, the company turns around and starts charging you a higher premium. It seems backwards, doesn’t it?
By contrast, with the debt settlement plan, you send the company all of the payments you can, and in the meantime, it will utilize any money it’s making on the side. You can get your payments straight to your creditors and cut out the middleman. Plus, since the settlement company collects money on your behalf, you don’t have to pay taxes or insurance fees.
3. You Can Get New Credit Now
If you can’t get new credit, getting out of debt can feel like an endless cycle of having to pay up, get new credit, and then paying more. Debt settlement companies solve this by reopening your credit files and starting the whole process over. The only stipulation is that you have to pay a fee to re-file with all three major credit bureaus.
4. You Can Quit Paying Interest
This might be the biggest reason of all. With debt settlement, you can stop paying interest on your debt and, potentially, quit paying on the debt itself. That is a tremendous weight lifted from your shoulders.
5. It Allows You to Get Money from Old Loans and Repossessions
Sometimes lenders will agree to settle for less than what’s owed on the loan if you agree to settle with the loan holder and the seller of the collateral, and sign a letter attesting that you’ve done so. But what if you don’t own the property, you owe money on? Can you get the money from the sale? The debt settlement company will provide the collateral and charge the buyer a fee to settle with you.
6. The Money You Earn is More Meaningful
When you make payments toward your creditors, it’s not like they’re buying a one-way ticket to paradise. Instead, they end up receiving a small fraction of the outstanding balance. Once you settle your debts, you’re no longer paying interest on them. If they can get the money back from you, they can actually do something with it, instead of just sitting on it and doing nothing.
7. It’s a Different Way of Settling Debt
When you settle your debts through a debt settlement company, you’re not getting anything from the original lender other than your credit reports being updated. This is a much more effective way to resolve your debts. When you settle your debts through a lender, they end up owning a small portion of your debt. This can be a good thing, depending on the value of the debt you owe, but it can also make you feel like a slave to someone who has no vested interest in your success.
8.It Works Better for Bigger Loans
If you’re struggling to pay off a $1,000 loan, it’s very easy to get yourself into trouble. You need to pay up front and don’t have any wiggle room. With a debt settlement company, however, you can settle your debt for significantly less and get money to yourself. This is a huge benefit for any person who has a small amount of debt, as well as people with larger loans.
9. There Are No Deadline’s
Debt settlement is a good option when you have some time to think. The payoff for settlement is substantial, but there’s no hard deadline or deadline clock hanging over your head. The settlement company is not pressuring you to have your debts paid off by a certain date. That also means you can settle the debts when the situation is a little better for you.
10. You Can Get Money Anywhere in the World
You don’t have to be in the U.S. to get money through a debt settlement company. You can settle your debts in different countries around the world with a single payment. The companies that settle your debts can provide you with the necessary paperwork, in the language of your choice, so you can settle the debt without any extra paperwork or legal forms.
Debt settlement is a good way to get back on track financially. When you settle your debts, you’re no longer paying interest on them and you can use that money to pay other debts you owe. It’s a win-win situation that will help you to get back on the right path financially. If you’ve made some mistakes, and you’re just feeling overwhelmed by your debt, debt settlement might be the best option for you. However, you need to make sure that the debt settlement company you settle with is reputable and has been around a long time. Make sure you can afford the loan, and that it will actually work in your favor.