Credit Card Debt Settlement

The most common monetary problem experienced by Americans is bad credit card debt. Surveys would defend this claim since they believe that it would be the next big problem that people would most likely experience in terms of their debt. Are you living a nightmarish life wherein you would receive notices on your mail almost too often because of your credit card debt?

Do you think your head will explode with countless of telephone calls that would flood your day? Of course, you don’t want to run away from your obligation since what you’re willing to do is settle it but in a lesser price. If this is the case then credit card debt settlement is the answer wherein the creditor will agree to pay the amount in a single payment as long as it will be completed in a short period of time.

Are you wondering why the creditor would consent credit card debt settlement? If bankruptcy will be approved then your credit card company would not get even a single centavo from you, thus they would settle with lesser payment than not get anything at all.  You should remember that they would put a note in your financial report as to inform future creditor that you failed to pay the full amount of your debt, but this is a lot better option than bankruptcy.

Normally, the creditor would grant credit card debt settlement to the account which is recent. The account must be delinquent for 90-days before settlement is possible and there are some companies that would require more time. Sometime, this settlement is not always the answer to anyone’s debt problem since there are cases wherein it would not fully satisfy the debt.

For some, they would pass on the portion uncollected to another agency for advance collection activity, Moreover, the IRS only regard the amount which was not considered as income. Debt that exceeds $600 will be accounted on the 1099 by creditors thus you are obliged to pay taxes.

Distinguish your credit card report, if you can’t see the debt on it then better leave everything as it is. If there is a negative note that says ‘charged off’ then that’s the time to go for credit card debt settlement wherein “settled for a lesser amount” will be marked which is still a negative note but not as serious as not paying anything at all.

Advisably, talk to your original creditor if you want to opt for credit card debt settlement. You can do this by writing or if not head straight to the office of the collection agency. However, it is better to jot down the terms to prevent future problem.

The instance when you will have to pay your dues, seek for ‘release of debt’ marking as to verify that the company actually consent your action. When everything is fine again then the next step is to determine the circumstance that leads you to incur the debt, try to do all means to prevent committing the same mistakes again.

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