Debt settlement is really very necessary for credit card holders. Though, it is really hard to trust the company that assures you debt settlement, because many of those companies fail to deliver your settlements program on due time. And it happens that many of the promised companies collect their fees early which affect your debt settlement program.
Moreover, you can avoid working with any of the company that charges fees before any settlement of your debt. It also happens that no explanation is provided by the company regarding serious consequences ahead. So, in that case you must be careful.
8 Myths About Settling Credit Card Debts
You must follow these safety measures for settling your credit card debt:
1. You can cut your credit card balance for any reasons
Debt settlement is for the tough time that most of the employers face. Our life doesn’t remain secure in such a long run and it is necessary to remain secure on time. So, this security can help you manage in time when you face critical situation in your family like death of any of your family members, or any serious medical issues. Thus this money is being saved in a systematic way to meet your needs.
2. Can I take help from someone to settle my credit card debt?
One of the truth confess by Kenny Golde, who is a author and a film maker is that- during the making of a movie he lost his partner and the movie completed by the time. Later, what happen is that his movie was not bringing any penny and he lost almost any hope. Nevertheless, he heard about dept settlement and made his mind to save nearly about $150,000.
Having a good negotiator who can guide you in this task is really necessary because if you hire someone may demand taxes in advance and might lead you nowhere. So, if can research and do your debt settlement on yourself its best.
3. Paying upfront for debt settlement and letting those Settlement Company controls your money
It is good to be aware of certain rules that are made for the safety of common people. The Federal Trade Commission of October 2010, declares to safe the money of the customers and open for them new account separately. These will help the consumer get the funds and that the provider doesn’t exchange any fees from the registered account.
You can withdraw from the debt relief service without any penalty and this will repay you with heavy interest in the following days.
4. Does Debt settlement hurt’s your credit score?
Do you know that settlement can really hurt your credit ranking as bankruptcy usually does? However skipping payments and succeeding in getting a settlement will definitely harm your credit ranking. R. Glen Ayers says, failing to pay the obligations or loan will not harm your ranking unless it is given an account of.
5. Does using a debt settlement company cost much?
It is said by Tawney that account financial support are not allowed any further because your payment to those settlement company differs, but those who are of lower rank will require to pay more in order to take loan and establish credit in days ahead.
You will be charge from the debt settlement companies a percentage of the debt enrolled or a percentage of the savings negotiated between you and the company. Thus, your lower score might affect your settlement for coming years.
6. If you fail to settle, your debt stays forever
As there is certain limitation for collecting your debt, it can be seen that most consumers who didn’t purchased the card fail to collect their debt on time. If the debtor fails in paying towards the existing account for number of years, in that case the dept is no more valid in court.
Thus, when the debt is no longer active, the security of credit will get perish and the negative information also gets decline after 7 consecutive years.
7. When you can’t pay- the only option is Debt Settlement and bankruptcy
Remember that you always have second choices- in case you become jobless the company might ask for some compensation or simply let you free, but they will ask you for interest later. Tawney says that “Some people are really good and making progress in credit without any third person’s help, while the other remains bankruptcy.
If you can settle your debt, it is a good decision for many of you who are stuck in dues. Its time to get control over your money matters by taking the help of a nonprofit credit counseling organization. This will greatly help you in managing your budget and ultimately increase your income than ever before.
8. Once the negotiations gets done, you can be out of debt
You must keep yourself alert since many companies are launched which gives you fake promises. So, it is better to distance yourself from such debtors.
Thus, by now you must become aware about how to maintain your credit card debt by proceeding towards some safety measure which offers you proper security.