Maximizing Your Chances of Debt Settlement Success
Debt settlement is an agreement between a lender and a borrower who has fallen behind on payments. The borrower pays a lesser amount than the outstanding balance, and in return, the lender forgives the remaining amount. No one gets everything they originally wanted, but at least the debt goes away. Debt settlement can make a troublesome debt go away quickly, and the amount that the lender forgives can be considerable. Meanwhile, it adversely affects your credit score, so it can reduce the amounts that you can borrow in the first few years following your signing of the debt forgiveness agreement. Therefore, people do not choose debt consolidation when they have access to debt consolidation loans at affordable interest rates or when their income is high enough and reliable enough that they can simply afford to pay down the outstanding balance gradually. Debt settlement is a desirable option, however, for people who want to avoid filing for bankruptcy. For help negotiating a debt settlement, contact a Miami debt lawyer.
Offer a Lump Sum That You Can Pay Almost Immediately
Successful negotiations begin with the parties identifying a common goal. In debt settlement, the common goal is that the lender and the borrower want the debt to go away. The lender is tired of not getting paid, and the borrower is tired of owing money. You, the borrower, should make the first move. Tell the lender that you are both tired of this unpaid debt and then you can make it go away by paying a lump sum of X amount.
It follows that you should only do this when X amount is already in your bank account, because the lender will want to receive the money quickly after signing the agreement. If you have just received your tax refund and are looking for ways to use it to improve your financial situation, using it as a lump sum debt settlement is a good idea.
Accept That You Owe the Amount
Debt settlement and disputing a debt are both ways of making a debt go away, but they are mutually exclusive. If you genuinely believe that you do not owe the debt, you should dispute it. Acknowledging that you owe the debt is part of debt settlement, and it should be one of the provisions of the debt settlement agreement.
Ask for a Settlement Agreement in Writing
Do not pay the debt settlement amount until you and the lender sign a debt settlement agreement. If you pay without signing a debt settlement agreement, the lender can easily go back on its word. The worst-case scenario is that you pay the lump sum, but the lender says that it is simply an installment payment, and you still owe the rest of the balance you originally owed.
Work With a Debt Lawyer About Finding Your Way Out of Credit Card Debt
A South Florida debt lawyer can help you negotiate a debt settlement for a lump sum amount that you can afford. Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.
Source:
cbsnews.com/news/things-to-say-and-not-to-say-when-asking-for-credit-card-debt-forgiveness/
