Preparation For Debt Settlement On Your Own

By Author: J.J. Yong
Total Articles: 963
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Hiring a debt settlement company to negotiate the debt on behalf of you is costly. Do you have the intention to settle the debt on your own? If yes, here are some useful tips for you to get started. You need to bear in mind that all creditors have no legal obligation to agree on debt settlement. In order to overcome this, you need to use the right strategy to encourage them to work with you so that both parties can achieve a win-win situation.

First thing first, you need to read carefully all the terms and conditions of your debt. You must be fully aware of the monthly fee, surcharges, interest rates, taxes and annual processing fee that apply. At the same time, find out the total amount of outstanding balances that you owe.

Secondly, in order to settle your debt, you definitely need certain amount of fund. Get yourself prepared with the money. You are required to gather enough funds so that your creditors are willing to consider your request. Although you don't need to pay the debt amount in full, you need the cash amount which is equivalent to 70% of the total debt. In the situation where you have too little ...
... fund, you totally don't have the strong power to negotiate and your creditors also won't take your request seriously.

Once you have gathered enough funds, it is time for you to make your settlement request in writing. Start your offer with a lower amount, i.e. 40% of your total debt. If possible, get a professional who has legal background to check your letter before sending it out to your creditor. This is to avoid any inconsistencies or unnecessary items which are not in favor to you.

If your first attempt fails, increase your amount of repayment gradually and renegotiate. This process may be repeated few times until both parties come to a final agreement. If your creditor agrees to your request, you are reminded to get a written agreement from the creditor.

Once the agreement is received, you will be more secured to make your payment. Make sure you get a written confirmation of the receipt of payment and the clearance appears on your credit report within 2-3 months after the payment is made.
For more information about debt settlement letter, visit DebtSettlementChoice.com.