When is the Best Time to Negotiate a Debt Settlement Agreement?

If you are considering the possibility of debt settlement, is there a particularly good time to negotiate a debt settlement agreement or to accept one? Or do debt settlement negotiations work the same way at any given time? Given that credit card debt has recently hit a record-high rate, many Georgia residents are thinking about a debt settlement negotiation. Debt settlement agreements can be especially beneficial for Lilburn residents who can afford to make a lump-sum payment even if they cannot afford the full amount of debt they owe. A recent report from CBS News discusses some of the best time points at which to enter into debt settlement negotiations with your creditors. Our Lilburn debt settlement lawyer can tell you more.

Your Account is Past Due (But Not Yet Charged Off) 

Debt settlement often makes the most sense when you are already behind on payments to your creditor. Usually, it makes the most sense to negotiate a debt settlement agreement when you are at least a few months behind on payments but your debt has not yet been charged off by the creditor. According to CBS News, the ideal time window for negotiating and accepting a debt settlement is when your account is 90 to 180 past due.

At this point, the creditor may be considering charging off your debt. The creditor will also likely plan to sell your debt to a debt collector for much less than what you owe. According to CBS News, creditors often sell debts to debt collectors “for pennies on the dollar.” As such, you may be able to negotiate a settlement agreement that is significantly less than what you owe.

You Are Considering a Bankruptcy Filing

 Anyone who is at the point of considering bankruptcy should find out about debt settlement first. You may be able to get a fresh start financially by paying only a small percentage of what you owe, without having to go through the bankruptcy process. Debt settlement involves a much less significant impact to your credit than a bankruptcy filing does. As such, it is often preferable for debtors.

You Can Afford to Make a Lump Sum Payment 

Finally, you should only consider debt settlement if you are going to be able to make a lump-sum payment to your creditor or creditors. To be clear, you will not need to pay the full amount of your debt. Instead, you will need to pay a percentage of what you owe. You may be able to obtain this type of money by selling off an asset or dipping into a savings account.

Contact a Georgia Debt Settlement Lawyer for Assistance 

Are you wondering if debt settlement is right for you? It is important to discuss your present financial circumstances with a lawyer who can help. An experienced Georgia debt settlement attorney at Konn Law Firm LLC can speak with you today about your debt and the possibility of debt settlement. We can discuss the likely amount you would need to consider paying in order to settle your debt, based on the amount you currently owe in addition to other factors. With a debt settlement agreement, you can pay less than the amount you and have the remaining debt forgiven. To find out more about settling credit card debt or other types of unsecured debt, contact our firm today.

Source:

cbsnews.com/news/when-to-take-a-debt-settlement-offer-when-not-to/