Settling with Creditors
You’ve restructured your financial plan, worked with a counselor to reduce your debt, and taken on a third job to pay the bills. But you can’t seem to shake threats from creditors. Short of filing for bankruptcy to relieve your unsecured debt, what can you do?
One answer involves negotiating to settle debts for less than their complete amount. Creditors often will accept “half a loaf” from debtors because -- assuming the debtor goes into bankruptcy -- they may wind up with no money at all.
Howard Law, can help you attain the support and services you need to negotiate effectively with the people and corporations who hold your debt. Once you have negotiated these obligations down and paid them off, you will get letters from your creditors clearing you of further obligations. It’s important that you make copies of these letters and send them to all three credit bureaus - TransUnion, Experian and Equifax - so that you can get your credit rating back up to a healthy level. If you can settle your debts without filing for Chapter 7 or Chapter 13, you can speed up your reorganization.
Bear in mind that not all creditors will settle with you. If your offer doesn’t sufficiently compensate a given creditor, he may refuse to negotiate out of spite or out of the hope that he can collect from your liquidated assets before other creditors can. Moreover, the Internal Revenue Service will still require you to pay out taxes on your settlement. (You can, however, file a 982 Request with the IRS if you are undergoing unique hardships.) In addition, the credit bureaus will likely downgrade your credit rating until your debts have been cleared off.
To learn more about how to navigate your complex debt negotiation situation, get in touch with the team of Howard Law, today. The firm offers a complementary consultation regarding personal debt settlement matters.