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gold dollarDo It Yourself Debt Settlement -
Do Your Homework And Be Prepared!

Anyone considering 'do it yourself debt settlement' with their creditors should review the points outlined here first.

People considering debt settlement as an alternative to filing for bankruptcy traditionally have two choices: try to negotiate your debt on your own (aka do it yourself debt settlement), or enlist the help of a third party debt settlement company.

Option #1: The first option can be quite intimidating as it involves dealing with aggressive bill collectors or credit card companies on your own but with calm, steely resolve, it can be accomplished.

The second option eliminates those concerns to a degree, however you will pay substantial fees, for someone else to handle the debt negotiations for you.

The fact is that any do it yourself debt settlement information offered by consumer credit counseling agencies may come with some indirect bias. This is because corporate creditors provide kick backs or 'referral fees' to these agencies when financial counseling results in the debt being paid off.

Do your homework around the details involved in settling credit card debt. Know exactly how much you owe each creditor and all the details of each debt. Be prepared to make payments on a newly agreed amount, or have the funds to pay the agreed balance in full.

Determine the statute of limitations for credit card debt for the state in which you live.

If the statute of limitations in your state is five years and you have a debt that is six years old, you have a little more leverage with debt negotiation as the debt has surpassed the statute of limitations and the creditor cannot take you to court to recover funds. (We have more information on Statute of Limitations on credit card debt here.)

Start with the oldest debt, as it is likely to be the one that creditors are most willing to negotiate.

Also keep in mind that creditors typically do not consider debt reduction until debts are at least four months old.

Settling Credit Card Debt

When making the first phone call, ask to speak to someone who is authorized to make debt negotiation agreements. Be calm but forthright and summarize your financial situation with the authorized person. Settlement offers could range anywhere from 30% to 70% of the original debt.

Whatever agreement is reached must be obtained in writing from the creditor. Request this documentation be sent electronically by fax, email, or through the postal service. Do not make any payments until the documentation is received!

The final and often overlooked step is to ensure the collection agency or creditor updates your credit report with any new payments. Otherwise, you should send a copy of the documentation detailing the settlement and any payments to each credit bureau: Experian, Equifax, and TransUnion.

Option #2: Debt Management Services Instead Of Do It Yourself Debt Settlement.

Debt management services and companies charge 20% to 25% of the original balance as a fee.

Note: Fraud is not uncommon when dealing with settlement companies. The best way to avoid a scam is to investigate a company before any agreements are made. Unfortunately, there are a lot of fake businesses that try to take advantage of people through scams and tricks that seem valid. When payment is received the companies often disappear from the radar, leaving a person in a situation that is potentially worse than the one they were in.

As long as people take the necessary precautionary measures, they can successfully avoid the fraudulent companies who do not have the best interest of clients in mind.

Despite the potential disadvantages of using such services, there are plenty of genuine settlement agencies on the market which are intended to provide customers with the best service possible.

Do it yourself debt settlement may be better than paying thousands of dollars to debt management companies or opting for the last resort of bankruptcy.

You might want to consider purchasing a "do it yourself debt settlement" guide to help you learn the process faster.

ZipDebt - #1 Source For Do It Yourself Debt Settlement and Elimination

Option #3: ZipDebt offers a third option which avoids those hefty fees, yet offers training and coaching to help you negotiate settlements on your own. The very best of do it yourself debt settlement. You have the option to choose the Basic ($197), Enhanced ($397) or Premium Program ($777).

Each program offers at the minimum: one 8 hour Audio-CD course/debt settlement success seminar, CD-ROM with forms and letter, course workbook and three bonuses (legal advice report, DIY credit repair e-book and telephone coaching session).

One step up from the Basic Program is the Enhanced Program which adds 6 months of unlimited email coaching and document review service in addition to the previously mentioned material.

Finally you have the option to purchase the Premier Program which increases the 6 month email coaching and document review to 12 months and adds telephone coaching for one year as well.









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