About Debt Relief - Debt-Assistance-Today.com


1. Debt Settlement

Did you know that most creditors, in certain situations, will agree to accept less than the full balance owed by you to settle outstanding debts? If you owe an amount of money so large that you’ve been considering bankruptcy, Debt Settlement may be your better option.

Debt Settlement is the way to get out of debt -
• In the shortest amount of time;
• Requiring the least amount of money from you;
• Without your having to file for bankruptcy.

In Debt Settlement, a company negotiates with your creditors to settle your debt for an amount lower than the amount you actually owe. You pay that lower amount in one lump sum. Once the debt is settled, the creditor sends a letter stating that your debt obligation was fulfilled. Credit bureaus are notified that your debt has been “Settled for less than full amount,” “Paid” or “Settled”. This obviously makes a great deal of sense for the debtor – the person who owes the money.

As the debt negotiation firm DebtXS points out, there are several reasons why Debt Settlement also makes sense from the creditor’s point of view. If you filed for bankruptcy instead of opting for Debt Settlement, the creditor would get nothing. With Debt Settlement, the people you owe are able to get as much money back as they can.

The IRS considers a forgiven debt as taxable income and expects taxes to be paid on the settlement. The IRS, however, provides form 982 for special hardships. In Debt Settlement, the debtor’s credit report does reflect that the debtor is behind in payments until all debts are settled.


2. Bankruptcy

Bankruptcy is often the last resort for most people. Hoffman, Brinker & Roberts, Inc., a respected firm that has helped hundreds out of debt, reminds us that bankruptcy is a matter of public record and can remain on one’s credit report for up to 10 years. Filing bankruptcy requires you to appear in Federal Court for one or more hearings. Certain types of bankruptcy also require a court-appointed trustee to control and oversee your estate.


3. Consumer Credit Counseling Service

A consumer credit counseling agency can often get your interest rate lowered and stop harassing collection calls. It is important to understand though that unlike Debt Settlement, you will pay the full balance owed plus interest on your various accounts. You make one monthly payment to the consumer credit counseling agency for the full amount owed. Then the service – often a nonprofit organization funded in full or part by creditors - disburses your funds to pay each of your creditors.


4. Obtain A Debt Consolidation Loan.

A debt consolidation loan is often a good option. You must, however, own a home (or other sufficient assets) to pledge as collateral for the loan that you will be paying back.


5. Do Nothing.

Doing nothing is not really a practical solution in the long run. But say you are currently unemployed and have zero assets a creditor can pursue. You would technically be judgment proof for now. Creditors can seek the money you owe at a later date, however, so simply “doing nothing” doesn’t really solve your problems.