When you first started struggling with debt, it’s likely that you picked up one of the many books on the subject. The New York Times Bestselling booklist often has titles authored by famous financial authorities like Suze Orman and Dave Ramsey. These money gurus also have websites, TV shows and radio shows. Their method of paying the bills is the same–strict debt diets and cutting up all the credit cards. And when it comes to debt settlement, you can bet that ‘trusted’ financial advisors in the media and other in resources, like MSN money, warn strongly against it.
It makes sense that some debtors are suspicious of debt settlement. After all, Americans have been hearing on the TV and radio that debt settlement is bad from the financial advisors that they trust, and even from the debt coaches on Ophra’s popular “Debt Diet” series. Consumers have also been raised up by the principle, “if it sounds too good to be true, it is”.
And most consumers will agree, that debt settlement sure does sound good. Debt settlement is a debt relief option that is based on negotiations with the creditor owed. The goal of debt settlement is for the consumer to be able to completely pay off the debt for 50% or less than the amount owed. This is usually accomplished within a 12 to 36 month time span.
There is nothing illegal about debt settlement, whether you attempt it on your own, or you use a debt settlement company. Why then, are many popular financial gurus against it? This is most likely because all debt settlement companies were not created equal. The debt settlement industry is still quite new and its growing rapidly, as is consumer debt in America. The government hasn’t been able to keep up with the growth, and the industry is therefore lacking in regulation, meaning that some companies are unreputable. Money gurus in the media don’t endorse debt settlement because they don’t want to be held responsible if one of their followers takes their advice, but falls victim to a debt settlement scam.
The key to debt settlement then, is choosing a professional debt settlement company. There are several things that consumers should look for when evaluating a debt settlement company. If the company doesn’t seem to have a physical address, a phone number or asks for large sums of money up front, these are major read flags. Reputable debt settlement companies will hold memberships to the Better Business Bureau, Local and National Chambers of Commerce and debt industry organizations. They will also take the time to talk to you, answer your questions and explain the debt settlement process in detail.
Debt settlement is a great debt resolution, but it’s not for everyone, and this is another one of the reasons that some financial advisors warn against it. Debt settlement is only for unsecured debts, usually in excess of $5000. Candidates for debt settlement are those who are struggling to make their monthly payments or who can no longer make the minimum monthly payment on their bills.
Despite the negative representation of debt settlement by some popular financial advisors, it is actually one of the best debt resolutions available. Debt settlement is the fastest way to become debt free and move on with your life.
Learn more about debt relief and how debt negotiation can help you become debt free in as little as 12 to 36 months.
