The main advantage to working with a debt settlement company, is that it typically saves you from having to personally deal with multiple creditors who may be hassling you to pay your account, which that in itself can be quite stressful. However, if that is not of concern to you, then many times you can actually do just as well or better in reaching your own settlements.
With the current state
of our economy, there are literally thousands of more people who are now unemployed and either cannot pay their bills in full, or are even forced in to bankruptcy
. Lenders are well aware of that situation, and rather than risk losing everything, most of them (especially credit
card companies with unsecured debt) are willing to work with you in settling your debt. Rather than risk you filing
for bankruptcy where they stand to get nothing at all or a very small amount, they would rather settle for another amount.
As I said earlier, the main issue is that it can be a hassle working with them, particularly if you have multiple lenders involved. But if you have the fortitude to do this, then in all likelihood you can get the same or better results on your own.
The one thing you do need to keep in mind is that any portion of your debts which are written off or cancelled then become subject to tax, the same as if it were income
to you. So when you are trying to negotiate these debts, also try to factor in that cost, and use that as another bargaining tool with the lenders.
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Thank you scott, and please let me know if you have additional questions or concerns.