We know that the U.S. economy is continuing to grow; however, the American consumers are still continuing to accumulate debts and are, therefore, grappling with insurmountable debts.
The economic outlook of the U.S.A. seems to be healthy as per the vital economic indicators. In this context, the most crucial indicator is supposed to be the GDP or the gross domestic product that is known to measure the production output of a nation.
According to thebalance, the U.S. GDP growth rate is actually expected to be between the 2% to 3% ideal range. But even with the American economy booming, several consumers are finding themselves neck-deep in debts, particularly, credit card debts. Some of the common reasons for this vicious cycle of debts could be natural disasters, illness, loss of employment, and some unexpected events that have culminated in disturbed or disrupted cash flows leading to debts.
As per Experian, the credit card debt on an average is up by nine percent as compared to the last couple of years, but for those cardholders having profound subprime scores, it seems to be up by 26%. The total consumer debt in 2018 is 3.898 trillion, which is 7.6% hike from the previous year. Moreover, ‘the average consumer debt per capita is approximately $11,880.’ Statistics reveal clearly how consumers are having a tough time dealing with debts.
When normal endeavors to repay existing debts fail, you may consider getting in touch with debt settlement firms and hire a trustworthy company for negotiating with your creditors on your behalf to reduce your debt balance so that you could successfully address your debt. You could browse through debt settlement feedback from customers online, to identify the right debt settlement company.
Debt Settlement: A Practical Solution Meant for Everybody
Credit card companies could be more than willing to settle your debts just for a fraction of the total debt amount owed by you when they realize the fact that you are genuinely going through a financial turmoil and gradually heading towards bankruptcy. If you file for bankruptcy, it would be a complete loss for the credit card company.
So they would be satisfied with whatever amount even if it is just a portion of the full balance. They would think that something is surely better than nothing. Moreover, debt collectors would usually purchase outstanding debts at very cheap rates from credit card companies. So they are often ready to settle provided they are able to make a substantial profit.
Here are some effective tricks to negotiate successfully with your creditors for a really profitable settlement of your debts.
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Be Prepared to Encounter a Refusal to Accept a Debt Settlement Request
Several people are of the opinion that if they have ended up accumulating a huge balance over time, on their existing credit cards, they could simply come up with some story regarding how they are going through a financial crunch and automatically, the card companies would be willing to negotiate for debt settlement. Unfortunately, the picture is not so rosy and both the collection agents and the credit card companies are very strict while considering a debt settlement request.
They would mostly ask for solid proof of your existing financial crisis and they may suggest effective solutions or adjustments so that you can make the repayment in full. Often, they may take a very drastic and stern stance and inform the customer that they are not at all bothered about the financial stability of the consumer and that you need to find out a way on your own and pay up the balance in full at the earliest.
Do Not Lie
When you are trying to convince the card company on the telephone, it is best to come up with facts and there is no point in lying or beating around the bush. Tell them that you are going through a major financial hardship and are not in a position to pay them all their dues. Do not lie. Tell them precisely the reason why you have been defaulting.
Do not even think of cooking up a story as you would be required to substantiate everything you say with some proof or documentary evidence.
No need to tell lies, such as you have got divorced or you are currently unemployed or incurred unanticipated medical expenses, etc. It is best to stick to the truth and to keep emphasizing the fact that you are opting for debt settlement for avoiding bankruptcy.
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Avoid Being Dramatic
Debt collection agents know of certain tricks that may trigger some statements from you which eventually would be working against you. So be calm and collected and do not get carried away. Resist all sorts of provocation. Interact with poise and calmness. If by chance you are thinking that you are losing a grip on the conversation, it is best to request a meet later on to continue the discussion.
It is a good idea to inform them that you would be recording the entire conversation. This would keep things legal and civil. You must maintain all the notes of the meeting, take down the name of the person acting as the representative of the creditor or the collection guy you have been interacting with.
You could quote in the event anything illegitimate was suggested or any verbal agreement was made.
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Know What Amount You Could Afford to Settle the Debt for
You must examine your financial scenario thoroughly and figure out exactly how much you could actually afford to pay as a debt settlement amount.
You must consider the fees, charges, and other expenses while determining the surplus that could be diverted toward debt settlement.
Even though most debt settlements are made possible only if you are able to make a lump sum payment in one go. But you may alternatively, negotiate for repaying according to a payment plan which you could actually afford. Best Bankruptcy attorney Mitchell & Hammond in Oklahoma City, Call at 405-216-0007 to schedule a free consultation with founding partner Gary Hammond.
Conclusion
You need to get the agreement of debt settlement in writing. Remember that verbal assurances make no sense and cannot be enforceable. Debt settlement seems to be an enticing way of getting out of your nagging debts but remember this process comes with certain implications. Your credit score could be impacted adversely.
Your credit report would have an entry of your debt settlement. This would remain in your credit file for the next seven years or so. Take smart decisions for surviving in the precarious quicksand of debt.
