Avoid getting deep in debt by using your credit cards wisely. In case this kind of problem arises, there are things that you need to do right away. You can settle this problem even without hiring a debt settlement agency. Besides, the settlement can be allocated for actual payment to the credit card firm.
See to it that the liability really belongs to you by asking for a debt verification or confirmation letter. Prepare all related documents such as credit card statements, receipts and payment notices from the lending facility. Figure out a reasonable amount for payment that you can offer to the credit card provider. It can be a single settlement for the whole amount or several monthly installments. You must determine how long the arrears have not been paid. This is important in reaching an agreement.
Refrain from sounding confrontational and irritated. Otherwise, the lender may not grant your request. In the same manner, borrowers should always be polite even if settlement is not agreed upon immediately. You need to be firm in a courteous way so the lender will remove fees and fines. It will reduce the debt amount significantly. Your objective is to lessen the amount of liability and not to wipe away the entire balance due.
Make an effort to decrease the remainder of your obligation as manageable as possible. If the credit card company has endorsed your case to a collection agency, take advantage of low quotas that many collectors propose. Offer 30 percent or possibly less of the amount you owe and negotiate for a specific sum that both parties will agree on. The offer should be desirable. An unreasonable reduction may not be possible. For example, the creditor may say yes to a 70 percent cutback but you must pay in a single lump sum.
You can request the lender to report the settlement as "paid based on agreement" and if possible remove trade lines related to your debt. The trade line is the account and history on an individual's credit report. These can take as much as seven years to be taken away from your report. Therefore, removal of adverse reports can be to your benefit. Nevertheless, not all creditors will agree to this condition.
It is also imperative to pay taxes on the amount of money that creditors take out from your excused debt. Finally, ask for a written agreement regarding what you have reached before making any payments. This is proof that both the creditor and debtor have come to a resolution of the issue.
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