Monday, November 24, 2008
The Truth About Debt Settlement companies
Debt Settlement industry is one of the largest growing industry in the United States today. But these debt settlement industries are permeated by myths, misinformation and controversy. Now it is my goal to provide truthful, factual, unbiased information to my readers and visitors in order to dispel the confusion and misinformation.
If we create a differentiation between the debt consolidation and debt settlement companies, one forward your monthly payments to your creditors and the other will place your monthly payments to them into a trust account, then forward the money to your creditors when there is sufficient funds in the account to pay a creditor in full.
We read on internet that Debt Settlement companies compelling arguments against the efficacy. They advertise that they can negotiate with creditors to reduce debts by 40% to 60%. Is this really possible? Lets take an example here, If you were a creditor, would you be willing to allow your debtors to pay only one-half of what they owe you? Obviously not.
But what if your debtors refuse to pay you and they were in a position where you could not collect from them by levying their bank accounts, liening their properties, or garnishing their wages. Now would you be willing to take a reduced amount? Your choices are - 50% or nothing. Which are you going to choose? The truth is - of the thousands of debt settlement companies, there are a few that can negotiate or settle debts by 40% to 60% as advertised. But they charge fees upwards of 15% of your debt.
Your goal as a debtor should be to become “bullet-proof” and you will be in the drivers seat to negotiate with your creditors without paying a debt settlement company to do it for you.
Before ending the post i would like to advise all of you that Stay away from back dated documents, hiding assets off-shore or in trusts, transferring properties to other people, or any other strategies that are not lawful.
What do you think of debt settlement companies? Are they really fake? Do give your feedback.