Eliminating 70% Of Your Debt - Is It Possible?

By Author: J.J. Yong
Total Articles: 963
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For people who have intention to reduce their debts with the assistance of debt settlement companies, there are some truths they need to know before signing up any plan. Although there are many service providers who claim that they are able to reduce their clients' debts up to 70%, it is usually not true.

Let take a look at my justification.

Reducing your debt up to 70% is unreasonable. I would say 90% of the creditors are not willing to accept this proposal unless the creditors really don't have any hope to collect the debt. The creditors will not entertain your request if you simply want to take advantage of not paying off your total outstanding. In their point of view, you have the financial ability to appoint a professional company to assist you, why don't you utilize your money to pay off your debt? In most of the cases, the settlement companies charge their clients based on a certain percentage of the debt forgiven. Sometimes, their service fee is high. It can be an additional burden to the debtors.

When you are in deep debt, you should take the effort to negotiate with your creditors on your own ...
... to show your sincerity to overcome your problem, not through a third party. You are encouraged to face your creditors with courage. You can either write a settlement letter or call up your creditors to request for debt reduction. If you are really a victim from the financial crisis, just tell your lenders the truth and seek their approval for more flexible repayment.

To sum up, even if a guarantee is given by the settlement companies, you have to bear in mind that things will turn out differently after you have signed up with them. The total sum forgiven by your creditors will not be as much as you expect. At the same time, your credit will definitely be affected if the service providers require you to drag the payment until the negotiation process is completed.
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