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Will Your Debt Settlement Proposal Be Rejected?
Debt settlement has become more and more popular nowadays because it helps people in debt to become debt free without declaring bankruptcy. However, you need to bear in mind that not all the settlement proposals are well accepted by the creditors and debt collection agencies.
Let me share with you some situations where your offer will be turned down:
In common, the lenders will only agree with the settlement offer if they know that their debtors have no other means of paying their debt. For those debtors who possess valuable assets, such as a car or a house with equity, their request for debt reduction will normally be rejected because in the point of view of the creditors, the debtors still have the ability to pay back their outstanding.
During the negotiation process, before the creditors making their decision, they usually analyze your credit report. If your credit file shows that you have a few credit cards open and you have been making payment on these cards, the creditors will straight away stop bargaining with you.
Normally the creditors will not entertain their debtors anymore if the ...
... past due is more than 6 months. The creditors usually have already sold the accounts to the debt collection agencies.
Creditors will totally reject your debt reduction plan if your total outstanding balances are a lot but you are proposing a very low settlement amount, say 10% -20% of your total debt.
In short, I would say that obtaining a "discount" from the creditors to pay lesser debt is not as easy as ABC, especially if the creditors feel that you are taking advantage from them. They would rather take legal proceeding against you or sue you for bankruptcy.
For more information about debt settlement solutions and debt settlement companies, visit DebtSettlementPoint.com.
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