Is There A Guarantee With Debt Settlement?

The fact is that with debt settlement, 40 to 60 percent of your debt is erased by a debt settlement attorney to get you some debt relief and creditors don’t like this.

Debt settlement should be approached with an open mind because unlike bankruptcy, there is no guarantee that the debt settlement attorney will be able to settle your debt.

In fact, no one can guarantee a settlement with a credit card company, collection agency or with a plaintiff’s firm representing a creditor. But the best chance to settle that debt is through a debt settlement attorney, not some settlement agency that may prove to have no results.

In fact a recent survey said the 2 to 1 debt settlement attorneys had double the success in settling debt and getting debt relief for their clients as opposed to companies.

No Guarantees But Better Than Bankruptcy in Some Cases
For the debtor, debt settlement can sometimes make sense where the debtor does not qualify for a Chapter 7 bankruptcy, and under Chapter 13 bankruptcy, the debtor would be required to pay back most of the unsecured debts anyway.

Going back to credit score, you are going to have a poor credit score anyway if you need debt settlement, so a debt settlement attorney can get you up to half of your debt written off.

There might be no guarantees but with the current economy, debt settlement attorneys have seen as much as a 10 percent increase in creditors accepting debt settlement. They are just trying to recover whatever money from you that they can.

Debt Settlement Examples
If a debt settlement attorney takes on a client, who has three credit cards with the balances of $20,000, $15,000 and $5,000 for a total of $40,000.

Assume the client elects for debt settlement. Suppose Cards 2 and 3 agree to settle for 50 percent, hence reducing the combined debt on those two cards to $10,000. Client A settles with Cards 2 and 3, and pays the $10,000 plus either attorney’s fees. Even if the $20,000 card does not accept the debt settlement, you still wrote off $10,000 of your debt for a total of 25 percent taken off.