Sometimes known as debt negotiations, a debt settlement basically means getting your creditors to agree to reduce your debt amount by up to 60% and you will usually be expected to make the final payment in one lump sum. Negotiations between the creditor and the debtor are integral into making a settlement. It is also sometimes known as debt reduction. A debtor can decide whether to negotiate with the creditor on his own or to hire a third party to play the part of the negotiator. It is often advised that the debtor get a debt settlement advisor to be the middle person.

A debt settlement is a common method used for credit card, medical and personal loan settlement. The main reason for choosing this particular method is because you could get the principal amount of your debt to be reduced by up to 60%. In some cases the creditors will even eliminate the interest and additional charges. One thing that is for sure is that once a debt amount is significantly reduced, the creditors will usually insist that the debtor pay the reduced debt in full.

If you are asking yourself, “How do I settle my debt myself?” you are already deciding not to engage a debt settlement advisor to assist you in your quest to get your creditors to reduce your debt and settle. So before you head off to meet with your creditors, there are a few things that you should at least consider and take note of so that you will be better prepared and learn some negotiating techniques, as follows:

– Best to be Prepared

Like a soldier going to war, you cannot simply barge head on without arming yourself. Gather relevant information about your credit card bills, credit ratings, financial history and bank statements. By giving yourself a full background check, you will know what to expect from your creditors. Chances are they also have the same information that you do and might even use it against you. If you are prepared, you will not be caught off-guard should they begin to ask you about your history.

– Advisable to Prioritize

You are probably trying to settle seven different debts from seven different creditors. Do not attempt to settle them all at one go. Set your priorities straight and begin with the debt that is affecting you and your whole family in a big way. Decide the maximum figure that you can afford to pay and offer less. You must remember that you also need to have some money to live on and support your family with while you are settling your debts. So do not try to siphon all your money into your debt settlement trust account if by doing so you won’t be able to provide for your family’s basic necessities.

– Be professional

Your creditors are most likely not going to feel any sympathy towards you. So be ready to negotiate like it is a business deal instead of begging for them to empathize with your situation. Creditors generally do not care about the ‘whys’. All they want is to see their money. Prepare yourself by knowing your rights as a consumer and understand your contractual obligations, checking your state’s credit legislation and perhaps even familiarize yourself with laws on harassment if your creditors are particularly persistent. Stay calm and focused and avoid getting unnecessarily emotional.

– Good to Take notes

Your negotiation sessions must be recorded whether in writing or if you prefer, in audio format. You have the right to record your negotiation session on tape. This way, your creditors will be less likely to be rude, condescending or even verbally abusive. Take as much note as you can about the discussion.

– Put everything in writing

Once an agreement is reached, make sure you put everything down in writing. Send a letter to your creditor via certified mail so you know when they receive it. State the nature of the payment agreement including the date of the negotiation. Most importantly, do it as soon as the negotiation is over. Putting it on hold is just going to make your creditors stay idle even longer.

Debt relief settlements are not too difficult if you have the right knowledge and attitude on how to approach it. Bear in mind that for most people, it is better to have a third party negotiate on their behalf. Professional debt settlement advisors have the expertise and the capacity to put up a better negotiation deal and argument while still staying objective and unbiased.

Author Bio: debt settlement settle my debt debt relief settlements

Category: Finances
Keywords: debt settlement, settle my debt, debt relief settlements