This is the most common question consumers have when researching Debt Relief options. If you don’t know much about the Debt Relief process, it is normal to be skeptical that your creditors will actually settle your debt for less than what you owe. While no one can predict exactly what a creditor will or will not do, most will work with you towards resolving your debt – especially when your account is past due. Banks and Collection Agencies settle debt each and every day.
Why are creditors willing to resolve debts for less than what is owed?
Once your debt has been written off, it is likely that the creditor will be willing to work with you to resolve your debt for less than you owe. The simple fact is that most creditors would rather get some of your money than none of your money. Your creditors have to make a decision to either settle your debt, or risk not collecting any money at all (in the event that you file bankruptcy).
When will the creditors consider a resolution?
Most creditors have guidelines as to when an account will qualify for a settlement or resolution. Most creditors will not consider a settlement until the account is at least 3 months past due. Other creditors have guidelines requiring an account to be 4, 5 or 6 months past due in order to resolve an account, at least to the extent of securing a favorable resolution. Once an account reaches the qualifying past due requirement as set by the creditor, not only will many creditors consider a favorable offer that you present, but the creditors themselves will often contact you directly to make offers to resolve the account.
Once the account reaches 6 months of delinquency, it is common that the account be sent to a collection agency or a collection law firm. Working and negotiating with most collection agencies is typically where some of the best deals are to be had.
The UGotiate Advantage.
Debt Resolution is not an exact science. As a consumer, it can be difficult to know if a resolution amount is fair or not. With UGotiate’s UGuidance, you will be able to compare a creditor’s offer to past offers and industry averages. This gives you the upper hand! Before making an offer or counter offer, you are able to review your creditor’s stats so you can feel confident in your offers. This may lead to lower settlements. It is important to understand that each person’s situation is different. Not all debts settle for the same amount and there is no way to predict exactly what your settlements will be. All amounts within UGotiate are based off of industry trends and recent settlements with other users. Past performance does not guarantee future results.