Self Help Debt Settlement vs. Debt Settlement Companies and Consumer Credit Agencies

Do It Yourself Debt Settlement or Do It Yourself Debt reduction are viable alternative to resolving your debt. The dirty little secret Debt Settlement Companies and Consumer Credit Agencies do not want you to know is: They can make thousands of dollars for a service that you can accomplish yourself. Hiring either a debt settlement company or a Consumer Credit Agency is like hiring someone to tie your shoes.

Once you have decided to Do It Yourself, you must make an unyielding commitment to the process. It is essential that you understand that your creditors, in almost every case, will not even discuss settlements if you are currently paying them. Once you stop paying your creditors, the debt settlement process begins. The creditor is going to start escalating their collection processes in an attempt to mitigate their financial losses. Your creditors will start calling you to bring your account current. Do not avoid these phone calls; these calls are your opportunities to advise your creditors of your intentions and initiate the negotiation process.

Consumer Credit Agencies do in fact have existing relationships with most creditors, however, what they fail to disclose is the fact that they receive payments from your creditors known as “fair share contributions”. These payments average about 8% of each payment you make to your creditor. In fairness we must advise you this payment is made to the Consumer Credit Agency directly from the creditor.

Now you have to ask yourself one question; if the creditor made the payment to the Consumer Credit Agency and not the consumer, isn’t the creditor losing money? Well it would seem so! But in point of fact, the creditor is making money! How you ask? It’s simple; when Consumer Credit Agencies contact your creditors, they negotiate a reduction of interest from that point on. These reduced interest rates vary in most cases from 10% to 14% instead of the rate you were paying. This means your creditor is still making 2-6% interest after paying the “fair share contribution” to the Consumer Credit Agency.

Debt Settlement Companies make claims that if you make them monthly payments your debt will be resolved within 24, 36 or 48 months. The payment amount seems to be reasonable to most people. A basic rule of thumb should apply to the above: If it seems too good to be true, it probably is! What the debt settlement companies forget to advise their clients (or hide it in the fine print of the contract), is that they take the first several payments to cover their sign up fees.
Most people who enroll with Debt Settlement Companies are under the assumption that the creditors have working relationships with the Debt Settlement Company. This is a false assumption; in point of fact, they have an adversarial relationship at best. This adversarial relationship impedes as well as prolongs the debt negotiation process.

The fact that you are willing to discuss your intentions with your creditors is to your advantage. By attempting to negotiate terms or settle your existing debt at an early stage will save you money. This along with the fact that you will save thousands of dollars by not hiring a debt settlement company, or a Consumer Credit Agency, will assist you in resolving your debt months, if not years earlier.

Visit our website http://www.2SettleMyDebt.com for more information about our services!