Can you use credit card debt services to eliminate your credit card debt?
You do not need to use a service as you can do it yourself but it sure can help to have someone intercepting those creditor collection calls. A service can provide you with experience in negotiation and insulation from the tactics used by debt collection specialists.
Tired of phone calls? Are you embarrassed talking to collectors? Let a professional handle that task for you. What do you have to gain? Money in your pocket is the probable result. An experienced debt negotiator should be able to shave an extra five to ten percent from the debt more than you will probably be able to get for yourself.
Unfortunately, you have to be in default on your payments to get most lenders to negotiate to reduce your debt. Federal law requires lenders to write off the debt on the books once the debt is more than 180 days past due. The debt is still owed but it becomes worthless on the books of the lender. The lender then has two choices and can either attempt to collect the debt or sell it to a collector for literally pennies on the dollar. Most lenders are not real good at collecting, after all they are in the lending business, so much of the debt gets sold.
The credit card business is also much like the mortgage business in that lenders packaged the balances into much larger packages to sell as securities. The debt is then not owned by the lender but by a group of investors with the lender or another party acting as the servicer. As one might imagine, it is very difficult to get someone to make a decision when trying to negotiate a settlement of the debt.
Between 120 days and 180 days from default, the creditor will become more apt to reach a settlement, either for a lump sum or a payment plan. One should always ask the creditor to verify the amount of the debt as to principal and what is interest and penalties.
The debtor must be willing to completely default on the debt and risk collection through lawsuit or otherwise. The older the debt, the less likely that it will be collected.
The experience of handling many negotiations means that using credit card debt services can effectively lower your debt and insulate your from the hassle of collectors.
In almost thirty years of law practice, James Montgomery has been giving advice to clients on how mortgages work, how compound interest can make one rich, and how to develop extra cash flow for investing in real estate or another similar investment.
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