Benefits of Using Debt Resolution Services to Settle Debts
Debt resolution is a negotiation entered into with the help of a debt settlement negotiator. Commonly, lenders will agree to settle for a percentage of the debt: usually around 40%, although results may vary widely. Once settlements are agreed, the negotiations are entered into writing. This explains the process you go through before the debt settlement process begins and how it works. It also describes how the negotiations will be carried out.
If you are wondering what debt resolution is all about then here is a simple explanation. Basically, debt resolution is the replacement of current debts by new ones. The old debts can be replaced with new debt consolidation loans that carry low interest rates and manageable monthly payments. A debt settlement company will then take over the negotiation process from you. This takes over the responsibility of dealing with your creditors. Instead they will use their expertise and contacts to reach agreements on your behalf.
There are many advantages in entering into debt resolution and one of them is that creditors don’t lose any money. They don’t have to go through the expensive procedures of bankruptcy and they also avoid any kind of legal action. In short, the creditor sees this as a win-win situation. Of course, before proceeding with the debt settlement plan the debtor has to find a good debt negotiation firm. It is important to look at different debt settlement companies before choosing one.
One advantage in debt resolution debt consolidation is that the company will provide you with an expert advisor who will assist you in taking the necessary steps. These advisors can include attorneys, financial planners, and even debt resolution specialists. So you are able to get help from multiple experts in one place making the whole process much easier.
Another advantage that you get by settling your debts with a debt resolution firm is that you can prevent bankruptcy. When you file for bankruptcy, you have to provide your lender with all the details about your income and assets. But when you choose a debt resolution company you will not be required to provide these details. So you won’t have to provide information that may be useful to creditors or they might take advantage of it.
You can also enjoy many benefits such as a clean credit report. With debt resolution you can get a clean credit report without being denied for loans and mortgages. The creditor will not have any reason to reject you since you won’t be having any bankruptcy or serious debt problems. This will make you more credible and your chances of getting loans and mortgages will be higher.
You have to mention all your assets, debts and incomes in the application that you send to the debt resolution companies. You have to make sure that you have a regular and consistent taxable income. If you don’t have a regular and consistent taxable income then you have to make sure that you have declared all your taxable income in your annual returns. If you have not declared all your incomes then you will have to specify your incomes in the future tax return that you will be filing. So the debt resolution companies will help you to reach the needed standards and you can easily become debt free in a few years.
If you are still not sure about the debt resolution options, then you can hire a free financial consultation to help you choose a right option. The financial consultants will also help you reduce your monthly payments and interest rate. The professionals of these firms will be able to make the creditors agree on lowering your interest rates and settling all your debts. This way you will be able to pay back the amount that you owe to your creditors in a very short time and you will never feel the stress that you were suffering from.