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Do It Yourself Debt Settlement
Debt settlement or debt negotiation is the process of striking a deal
with your creditor so that you can pay a reduced portion of your
outstanding balance or extend the period of
repayment. Negotiating debt settlement is never a pleasant task for anyone, but it
can be a lot less stressful if you work with your creditors in a manner
that can bring about positive solutions.
There are certain debt negotiation principles or guidelines that you
need to follow, if you want to negotiate debt settlements yourself and
not using a debt negotiation
service. This way can help you control your
financial situation before it's too late.
Preparing for a Debt Settlement Meeting
Communication with your creditors is the first thing. Don't avoid
their phone calls or any other attempts to reach you. This only
compounds the problem. Even if you are not quite ready to sit down and
do some debt negotiation, you still need to tell them that this is what
you intend to do.
When a creditor calls, emails, or sends you a notice in the regular
mail, answer back and be honest. Instead of hiding from creditors'
calling, contact your creditors and tell them that you would like to
negotiate your debts with them, and ask if you can make an appointment to
do this. Most creditors will appreciate your effort to pay them what you
owe, and will be more than happy to sit down with you to figure out how.
Before the meeting, do some research on your rights and on what
creditors can and can't do to get you to pay what you owe. Many times
aggressive debt collectors will try to convince you that you are facing
certain unpleasant consequences. Being well informed can help you when
it comes time for negotiation.
Steps to Negotiating a Debt Settlement
First, you must understand your exact account balance. Find out
how much of this balance is interest charges and how much are actual charges to
the account. This knowledge can help you think about what you will need
to say and do when you call your creditor.
Second, you can expect that the creditor may tell you that they never
enter into debt negotiations. If you get refusal answers, then you will
want to ask for a supervisor. If they still decline your negotiation
offers, you can write a letter stating that you attempted to negotiate
and that you can't afford to pay under the existing conditions.
At this step, wait for a call back from the creditor. While waiting,
don't allow yourself to feel bad about your debt but learn about how
your creditors look at your situation. If you have a decent debt
negotiation offer, there is a chance that your creditors jump at it and everyone will
be happy.
It is important that you find an offer that is fair and agreeable to both parties.
Your debt settlement objective is to hold your ground and ensure that
the terms are agreeable to you and that you are not pressured into
anything. You shouldn't accept the new terms that you feel are not
acceptable to you.
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