Debt negotiation is an option that many people in debt fail to realize exists. While you might assume that you have no choice but to pay your creditor the full balance that you owe them, there are other options available to you that are significantly easier and more affordable for you to pursue. There are multiple types of debt negotiation, which will be discussed below.
When you negotiate your debt, you can achieve some of the relief you are looking for without having to totally cave in to the demands of the creditor forcing you to file a bankruptcy case.
Debt settlement is a form of solving your debt issues, allowing you to settle your debts in either a lump sum payment or in monthly installment payments. You agree to pay the creditor a specified amount, and the creditor agrees to accept. Normally, these debts are settled for less than the amount owed. It is important to note, however, that debt settlement is not the same as debt consolidation, which will be discussed further down.
You can pursue debt negotiation yourself if you choose. If you are comfortable speaking with creditors, who are almost always represented by an army of attorneys, you are free to call the creditor and attempt to negotiate your terms.
If you are hesitant to do that, however, then hiring an attorney to negotiate for you might be the best choice. An attorney with experience in settling debt both in and out of court can be a huge advantage, as they understand the process and what it takes to get creditors to settle. An attorney assisting you with your debt negotiation can:
The most important benefit to working with an attorney is that he will do the legwork and be dedicated to getting you your desired result.
Many people confuse debt negotiation with debt consolidation. Debt consolidation is a very different process that involves hiring an independent third party to consolidate all of your debt so that you are only making one monthly payment that satisfies all debts owed. The goal would be to get the third party to pay down all of your debt; you would then repay the third party with interest owed. If the interest rate paid to consolidate is significantly lower than the interest rates you are currently paying to your creditors, then this is a good choice.
There are some downsides to debt consolidation:
The first thing you should do if you are sued while in the middle of a debt settlement process is contact an attorney, if you have not already retained one. An attorney can review the paperwork you were served with and see if any defenses can be made on your behalf. An attorney will discuss the case with you and assist you in coming up with solutions that will help address your concerns and ensure tht you are not taken advantage of by an aggressive creditor who preys on parties not represented by legal counsel.
Some options your attorney will present to you are:
Although a lawsuit against you has been filed by the creditor, the creditor will still communicate with you and sometimes be cooperative in working towards a settlement that works for both parties. Having an attorney by your side during this stressful process can be invaluable both for your peace of mind and to ensure you achieve the best outcome possible.
If you have questions about debt negotiation and want expert legal advice, contact Massachusetts debt lawyer Eric Kornblum today. With a wide array of experience in related areas such as bankruptcy, foreclosure defense and consolidation, he can help you get you the settlement you deserve.