Everyone's situation is unique debt and determine what will work best for you begins with categorizing your debt. If the debt is secured or unsecured significantly effects the measures you can take to eliminate debt.
debt is a secured loan is "secured" by property. In short, if the bank can come and take something from you if you do not pay (ie house, car), then the debt is secured.
Unsecured debt is the kind most common of the debt and usually in the form of credit cards.
Debt Elimination Unsecured
The three most common ways to eliminate unsecured debt are
1. pay as agreed
2. bankruptcy
3. reach an agreement with the creditor for less than the balance due – also known as debt settlement or debt negotiation
Bankruptcy is rarely a viable option. Because the law changes bankruptcy in 2004 by the Bush administration, it is estimated that less than 10% of people who file for bankruptcy successful performance of any debt. Most have to pay back now under Chapter 13.
Credit Counseling and Debt Consolidation services typically focus on eliminating debt through arrangement with your creditors for less than the balance due. These services are owned by the big banks and credit companies usually charge a fee. The good news is that this is something you can do on their own.
It settles for less than the outstanding balance
The key to a solution successful is leverage. If a bank thinks it can get more out of you, do not settle. This means that you may have to go for months without making any payment. These changes obey evil in your credit report and affect your credit score but is a necessary condition for obtaining a satisfactory settlement.
During the time you not making payments to the credit card company that constantly tries to contact you to talk about it. This is best treated from the start by sending a letter requesting that you contact only in writing. It is also very important to become familiar with their rights under fair Practices Act debt collections and the Fair Credit Reporting Act collections representatives often behave unscrupulously and know their rights is the key to fight.
Once they have sufficient influence to ensure that the company is the time to attempt a solution. A realistic goal would settle the debt of 35% -50% of the balance. Contact contact your bank or credit card directly and probably will be transferred to their collections department. Once in contact with the collections representative simply let them know you want to resolve the debt. Usually, they make you an offer to settle for 65% -80% of the balance before you make an offer to pay. Let them know what you have; an initial offer of 15% -25% of the balance is reasonable. You can say no or say you have to talk to their manager but continue the negotiation as necessary to settle within the range you want.
Some credit card companies are more willing to resolve than others. For example, American Express can be a very difficult company to settle with less than 60%. Search the Internet for information about your particular bank or credit card to see how others roads.
Learn everything you need to know about negotiating a debt settlement and eliminating your credit card debt at http://www.negotiateadebtsettlement.com/
Proper Ways to Eliminate Credit Card Debt
