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How To Get Out Of Debt With Debt Settlement


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How To Get Out Of Debt With Debt Settlement

  1. 1. ==== ====Are you deeply in debt with high interest rates or cant make your mortgage payments? Pleaseclick below for ====Thank You for choosing to free yourself from your FINANCIAL SLAVERY!"HOW TO TAKE THE LEGS OUT FROM UNDER THE CREDIT CARD COMPANIES, AND SAVEYOUR FINANCIAL LIFE WITH THIS INFORMATIONAL STRATEGY"Reading this will have an immediate impact on you so please set aside time enough to read thisthoroughly and make a conscious decision to better your situation.With the information we are freely giving you can commit to proactively break the BONDS ofFINANCIAL SLAVERY that has held you for a very long time.The truth is...your financial house is easy to run. All you need to do is to understand how theCredit Card works and use them to earn FINANCIAL FREEDOM.It is not important how you got here.It is not important if you owe 10k or 1million in credit card debt.If you cant sleep at night, and wonder if you will ever be financially sound again, then you needthis information.If the stress of your debt is ruining your family, and your relationships, then you need thisinformation.If you thought youd be better off financially, by now, then you need this information.If youre facing retirement, and cant possible see how you will be able to maintain your currentquality of life on social security, then you need this information.DEBT SETTLEMENT IN A NUTSHELL!If you decide to stop paying your creditors the way they want to be paid for the next 10-20-30years the original creditor will then sell your debt to a collection agency normally within 30-90 daysfrom the first missed payment. During this time the original creditor will call you for payment andtry and keep you as a client. If they get nothing from you they will sell your debt.The creditor sells your debt to a collection agency for 2 reasons:
  2. 2. 1. They get .20 cents on the dollar from the collection agency.2. They get an additional .50 cents on the dollar from the government in the form of a tax break.Therefore, the creditor gets .70 cents on the dollar, by selling your debt without you paying them adime.Lets say you owe Capital One $1,000. If you do not pay them then they will sell you to collectionsfor 20% of what you owe ($200). Then they turn around and get the tax break from thegovernment for 50% of what you owe ($500). So they have made $700 on your $1,000 debtwithout you paying them a dime.Once your debt has been sold to a collection agency for .20 cents on the dollar, send a Cease andDesist letter. By law they will no longer be allowed to contact you. They do not have the samerights as the creditor because they are a 3rd party who purchased the debt.Then tell the collection agency how you intend to pay them .40 cents on the dollar, giving them a100% profit, in exchange, they will report to the credit bureaus that your debt was paid or settled.Debt Settlement works by reducing the balance owed (principal) on your unsecured personal debtaccounts through the time-honored process of creditor negotiation. This is different from simplyreducing the interest rate as with Debt Consolidation and Credit Counseling, which do not affectthe total debt balance. By reducing the balance itself, Debt Settlement provides a much fastermeans of becoming debt-free. Most creditors are willing to accept 50%, 40%, sometimes as low as20% of the balance owed in order to close out an account rather than lose the entire amount in abankruptcy proceeding.As a consequence of this approach, money that was previously wasted on endless minimumpayments (most of which went toward interest charges) goes toward reducing the actual debtbalance. Thats why Debt Settlement through negotiation is the fastest debt elimination methodshort of Chapter 7 bankruptcy.If you cannot bear the thought of losing your financial dignity and loss of control by going throughbankruptcy, then this approach is for you.While the debt settlement approach is not suitable for everyone, its flexible nature makes itapplicable to a wide range of financial circumstances. For individuals and families seeking analternative to bankruptcy, there is simply no better option to get out of debt. Here are a fewguidelines to help you determine whether or not debt settlement is something you should consider1. Do you have a legitimate financial hardship condition?If you are over your head due to a hardship circumstance, and youd prefer to work things out withyour creditors rather than declare bankruptcy, then debt settlement can provide an honest andethical debt relief alternative.2. Are you committed to avoiding bankruptcy?Debt Settlement is best viewed as a bankruptcy alternative, one that allows you to keep control
  3. 3. over the process and maintain privacy while working through your financial difficulties. As withmost things in life, success is determined by your level of commitment to staying the course, evenwhen the road gets a little bumpy. If you are likely to give up at the first rough spot, then debtsettlement is probably not the best choice for you. But if you are determined to avoid bankruptcy,debt settlement will likely be the most attractive debt solution for you.3. Do you owe more than $10,000 in unsecured debt?Debt Settlement is strong medicine, and it should be reserved for serious debt problems. Whileeveryones budget is different, most people can work their way out of smaller debt obligations.In fact, it doesnt matter what mistakes you have made on your own, as it is NOT important at all.What matters now is HOW TO GET OUT FROM UNDER IT!SERIOUS QUESTIONS AND ANSWERSQ: What happens to my credit score?A. The effect of the debt settlement process on your credit score will partly depend on your currentcredit status before starting. Few people with debt troubles have perfect credit to begin with. Ingeneral, your credit score (usually called the FICO score) will decline during the process, and willbegin to improve again after you have become debt-free. There are several key points to bear inmind here. We recommend against applying for new credit while going through thedebt settlementprocess. It simply doesnt make sense to take on new debt while youre trying to tackle yourexisting debt problem.So the short-term decline in credit score is rarely a problem for clients. In addition, the credit scoreitself does not take into account your debt-to-income ratio, which is used by lenders (especially inthe mortgage industry) to determine whether you qualify for a home or auto loan. In other words,you can have a high credit score due to a clean payment history (even though its killing youfinancially to keep up those payments) and still be denied a new loan because you already carrytoo much debt.By completing the debt settlement process, your debt-to-income ratio will improve dramatically!Any way you look at it, the effects of Debt Settlement on your credit will certainly be less damagingthan the 10-year derogatory mark made by bankruptcy. Staying current on mortgage and carpayments will help your score.Q: What are the tax consequences?A. Financial institutions are required to report canceled debts over $600 (the portion forgivenduring the settlement transactions) to the IRS, and the debtor is required to report that as incomeon their tax return. However, the IRS permits you to offset any "income" from canceled debts up tothe amount you were "insolvent" at the time the debts were canceled. You are "insolvent" if youowe more than you own, or in other words, if you have a negative net worth.If youre deep in debt, its not likely that you have a positive net worth, so its rare that a clientwould have to pay taxes on the forgiven debt balance. The exception might be an individual with a
  4. 4. high level of home equity, which might make the overall net worth positive and thereby eliminatethe insolvency exclusion. However, this is the exception rather than the rule.It is a likely circumstance that you might owe tax on the forgiven debt balance, youll still be wayahead of the game by eliminating your debt balances sooner rather than later.Q: What about lawsuits?A. While creditors have the legal right to bring a lawsuit for non-payment of a debt obligation; suchlawsuits are far less common than most people think. It costs money to sue someone, and a legaljudgment is simply a piece of paper unless there is a way to collect money against it. The threat oflitigation, on the other hand, is all too common, even though debt collectors are not supposed tothreaten legal action unless they are specifically authorized to bring suit. In general, lawsuits cannormally be avoided, provided you are willing to work out suitable arrangements with yourcreditors through the negotiation process.Contrary to popular belief, most creditors would rather work things out amicably in a negotiatedsettlement than spend more money taking a customer to court (with no guarantee of being able tocollect on a judgment). Thats why thousands of litigation-free settlements are transacted everymonth all across the country. Creditors wont admit it publicly, but Debt Settlement methods worksmuch better for them than forcing people into bankruptcy through overly-aggressive collectiontechniques.This information is for your use, however is not legally binding, and it is suggested that an attorneyreview any settlement you enter into. The worst-case scenario is that a you might be required topay a debt balance in full in the event of legal action by a creditor. This is little different from thestarting situation most clients find themselves in, and again, it is a fairly rare occurrence.Q: Can my wages be garnished?A. If you listen to some debt collectors, you might be fooled into thinking that they will seize yourvery next paycheck unless you make a payment right then and there. The threat of losing part ofones wages to a garnishment action is truly frightening to someone already struggling financially.But this is mainly an intimidation tactic used by collectors to scare people into committing to apayment schedule whether or not they have the funds available.Actual garnishment actions are relatively rare, and do not happen without advance warning. First,a creditor must bring a lawsuit, obtain a judgment, and then take an additional step to obtainauthorization for the garnishment. Plus only one creditor can garnish your wages at a time. No onecan take your paycheck without court approval, and you must be given notice of such court actionthrough formal documentation. So dont be fooled by one of the oldest collection tricks in the book.Q: What are the differences between Debt Settlement and Credit Counseling?A. The most important difference between these two aproaches is that with credit counseling, youpay back all of the debt balances, plus interest and fees, whereas with Debt Settlement, you payback only a portion of your debt load. Thats why Debt Settlement is a much faster path to debtfreedom (2-3 years) than Credit Counseling (5-9 years). This means a lot less money out of your
  5. 5. pocket is used through the debt settlement approach.Another key difference is that your Debt Settlement firm works solely for you, the consumer, andreceives no compensation directly from the creditors. In other words, your debt settlement firm istruly on your side. With a credit counseling agency, there is a dual relationship, where part of theirincome comes from the client and the majority of it comes from kickbacks paid by the creditors.This creates a built-in conflict of interest and creates doubt as to whose side the agency is reallyon. Also, debt settlement provides much more flexibility than credit counseling in both the monthlybudget level and the types of accounts that may be enrolled.For example, if you have a really tough month and need to skip a payment, that situation can beabsorbed by a debt settlement process, whereas it will cause serious problems with a creditcounseling process. Further, if your accounts have "charged off" and gone into the third-partycollections cycle, you can still enroll those obligations in a Debt Settlement approach where theywill be rejected by a credit counseling agency. Additionally, you can begin to work on therestoration of your credit score, that much faster, having completed Debt Settlement.Q: What kind of debt can be negotiated?A. As a general rule, any type of unsecured debt can be successfully negotiated. An unsecureddebt is one that is not tied to a specific material item that could be repossessed by the creditor. Soan auto loan, for example, could not be included because the creditor could legally repossess thevehicle. Credit card debt, medical bills in collections, department store cards, signature loans,unsecured lines of credit, and revolving charge accounts are all types of accounts that can beincluded in our program.The main exception here are student loans, which in most cases are government backed loansthat cannot even be discharged in a bankruptcy proceeding. (Private student loans that are notsponsored by the government can be included.)Q: What if a creditor wont negotiate?A. Debt Settlement entities have established contacts with the major banks, collection agencies,and collection attorneys. Debt settlement is recognized as a viable solution by collection industryprofessionals.In the rare instance where a creditor balks at accepting a reasonable settlement at the time it isproposed, it is often a matter of simply waiting for a different phase of the collection process.Some creditors are more inclined to play "hardball" than others, but virtually all of the majorinstitutions eventually sell their accounts to collection agencies in order to get what they can forthe account. Since the collections agencies acquire these accounts for pennies on the dollar, theyare more inclined to accept a reasonable settlement offer, which still represents a profit on theirpurchase.Q: Are there debts that cant be negotiated?A. Secured debts cannot be settled. This includes home loans, second or third mortgages, equity
  6. 6. lines of credit, auto loans, and financing contracts tied to a specific piece of property that may belegally repossessed by the creditor. Federal student loans, although unsecured, must also beexcluded from settlement. In addition, Federal and State taxes cannot be included.Q: Can I do this myself?A. Yes, it is certainly possible for a consumer to negotiate his or her own debts. However, thereare several important factors that should be taken into consideration before making such adecision. First, do you have the time? For individuals with serious debt problems, the complexitiesof the negotiation process can be very time consuming. Many people simply do not have the timeto add this labor-intensive task on top of an already busy work schedule. Second, it requires acertain kind of psychological toughness to haggle with creditors.The average consumer is hampered by the embarrassment and shame they feel over havinggotten into trouble. With all the tricks, traps, and pressure tactics used by creditors, most peoplewill find themselves better off with professional assistance. Third, as with any profession, there aretechniques not easily mastered by an amateur. Without professional coaching, the likely result willbe high-percentage settlements in the best case and outright failure in the worst case.When you consider that the total payout including professional fees will still be far less than youroriginal balances, it makes more sense for the average person to obtain debt help from DebtSettlement entities.Q: Dont I have to pay taxes on the money I save?A. Yes you may have to pay income taxes on the amount you save, but this amount is usually stillmuch less than the amount you would have paid in interest. Check with an accountant for details.Q: What if I leave accounts out Debt SettlementA. We do not recommend leaving any accounts not settled, for two reasons:1. There is a good chance the credit company will see delinquencies on this or on your otheraccounts and close your account anyway.2. It makes it extremely difficult for us to negotiate with some creditors if they see you defaulting ontheir account and not others and hurts the settlement process.Having an ATM/debit card that is also a VISA or MASTER CARD tied to your checking or savingsaccount is a good alternative that will leave you with a credit card you can continue to use withoutaffecting this process.Q: What credentials or affiliations should a consumer look for regarding a Debt Settlementcompany?A.Debt Settlement companies should be members of a professional organization that specializesin this type of debt settlement negotiation. Including The Association of Settlement Companies andour Professional Debt Arbitrators and Trained and Certified by The International Association ofProfessional Debt Arbitrators.
  7. 7. CODE OF ETHICSThese practices should be followed and aim to improve the industry with Best Business Practicesfor Debt Settlement.1. Debt Settlement Specialists DO NOT TELL PEOPLE TO STOP PAYING THEIR CREDITORS!They should say that our clients make an independent decision to stop making monthly payments.This is a small technicality. and the sooner their account goes into collections the sooner it can besettled.2. Debt Settlement Specialists CANT STOP THEIR ORIGINAL CREDITOR FROM CALLING!Collection Agencies should be stopped with the Debt Settlement process. Until the debt is sold toa collection agency, the original creditor has every right to call.3. ONCE WE SETTLE EACH DEBT WITH THE COLLECTION AGENCY, IT WILL SHOW ONTHEIR CREDIT REPORT "PAID" OR "SETTLED". It will NOT show paid in full. Also, once paid,their credit report will show there were collection agencies involved and that their creditor chargedthem off.4. WE CAN NOT STOP THEIR CREDITORS FROM ADDING MORE INTEREST, PENALTIESOR FEES AFTER THEY ENTER INTO DEBT SETTLEMENT. Settled amounts are those thatwere owed at the time they started.5. IF THEY ARE CURRENT WHEN SETTLING DEBT, IT WILL INITIALLY NEGATIVELY AFFECTTHEIR CREDIT SCORE! If you already have accounts in collections, it may have little or no effectas it has already been tarnished. If they continue to make mortgage or car payments that will help,however, the bottom line is that this will only be temporary.6. IF THEY ARE PLANNING TO BUY A HOME, GET A CAR LOAN OR ANYTHING THATNEEDS DECENT CREDIT. If you are current on their bills, you should wait until after they havecompleted those types of transactions to realize the full depth of the financial picture and thenenter into a debt settlement process after. Advocating that would run counterintuitive to theessence of debt settlement. Many are being declined for mortgages or cars, etc because of oldbad debt in collections that havent been paid in years, if ever. An accelerated option should geteverything cleaned up and settled saving them thousands of dollars in pay offs. Additionallysettlements can be paid sooner that the date negotiated based on your payment plan, withoutpenalty.7. YES, YOU CAN BE SUED BY STOPPING PAYMENT ON DEBT! Absolutely one can be sued!Clients should be instructed to answer the law suit and by going to court, the court willacknowledge they owe the money. It is an unsecured debt, so basically the creditor is right backwhere they started. Negotiated settlements on these accounts that can lift garnishments or lienswhen paid.8. CAN THEY GARNISH THEIR WAGES? Absolutely! You can have your wages garnished insome states (for example, they cannot garnish wages in TX) and theres nothing we can do aboutthat. Settlements may be made with that company through to get the garnishment lifted. The
  8. 8. creditor would much rather get a lump sum settlement than get a little bit of money each month.Keep in mind that only one creditor can garnish wages at a time.9. CAN THEY PUT A LIEN ON THEIR HOUSE? Absolutely! If a creditor places a lien placed onsomeones house, they cannot collect any money unless the house is sold. Settlement with a lienholder may lift the lien altogether.10. THIS IS A BANKRUPTCY ALTERNATIVE! Remember folks, this information is to help peoplewho basically are drowning in debt and have little alternatives as far as solutions go.11. PREDICTING CREDIT SCORES IS IMPOSSIBLE! Debt Settlement Specialists dont knowwhat someones credit score will be when they finish their negotiated debt payments. It is clearthat it will drop once you begin it, and should improve once finished.12. ARE THERE ANY TAX LIABILITES ON THE DOLLARS THAT ARE SETTLED? Yes, therecan be. If someone has a negative net worth, which is most of our clients, then they most likely willnot be responsible for taxes on the money we saved them. We are not accountants, and dontdispense advice as if we were. Simply consult an accountant if this question arises. Bottom line, ifyou are responsible for any taxes, you are better off having to pay taxes on a percentage of whatyou didnt have to pay on their original debt, than have to pay 100% of what you originally owed."WORRYING ABOUT YOUR CREDIT SCORE WHEN YOU ARE DROWNING IN DEBT- IS LIKEWORRYING ABOUT WHAT YOUR FRONT LAWN LOOKS LIKE WHEN YOUR HOUSE IS ONFIRE!"For more information an in depth FREE REPORT through our website is available at[] - or for a no obligation phone consultation, please call(941)661-0668 and ask for Debt Settlement Please~Article Source: ====Are you deeply in debt with high interest rates or cant make your mortgage payments? Pleaseclick below for help
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