As the U.S. economy has struggled, many financial relief programs have taken a larger role in our day-to-day lives. One such program is debt settlement.
What Is It?
Debt settlement is a method of providing relief to those with unmanageable levels of revolving debt. Many have found the totality of their credit cards, medical bills and other personal loans reaching levels numbering in the tens of thousands.
Debt settlement programs aim to reduce that overall debt to a reasonable number that the troubled borrower can afford. This is accomplished through negotiations with the creditor
What Can Be Achieved?
Most debt settlement programs will report average settlement figures at around a 40% reduction in overall debt owed. These programs usually have the debt paid off within 36 months. This means a person with $50,000 in revolving debt could end up owing only $30,000 and pay it off within the next 3 years. It sounds difficult to someone mired in debt, but it can be done.
What Are the Drawbacks?
Your credit score will likely take a hit. There’s little way around that. But sometimes, you have to accept some downsides to achieve a greater good. High levels of debt are stressful and bring down your quality of life.
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