There are certain things one must not due or say when pursuing settlements on unsecured debt, the most important one obviously is not to tell your creditors you want to settle your accounts.
Most creditors offer settlements after Ninety days delinquency, it is advisable to wait at least this long to tell your creditors you are looking to settle your accounts. If creditors get a hint or they find out that a client is looking to settle his/her unsecured debt they may refer the accounts for legal action. This is the number one reason not to tell your creditors your intentions, just string them along until your accounts reach Ninety days delinquency, then drop the settlement bomb on them!
Try after this point to negotiate your account or accounts before they reach the charge off period which is reached at One Hundred and Eighty days. The best time to settle accounts in my experience is right around the One Hundred and Fifty day delinquency mark or five months. I have seen some of the best savings at this time.
Now that you are engaged in negotiations with your creditors, do not and I repeat tell them you have money to settle your accounts with. If you do this there is no way on God's green earth you will get a decent settlement offer. Remember, the reason you stopped making your payments was because you ha d a legitimate hardship. For those looking to beat the system and skip out of paying their bills do not try debt settlement, your creditors will find out where all of your money is stashed.
Tell your creditors even if you have your money under your mattress that your friends and family are willing to help out of your situation just this time around. If you have money in the bank, withdraw it and place it under your mattress. If you have stocks, give them to your kids, etc... Clear all traces of money before deciding to pursue debt settlement or your creditors will find out.
Creditors will run credit reports, they will find out how much equity there is in your house, they will find out how much money you make, there is no point in lying to them, if you have a real hardship such as a medical hardship or other if you have documentation to prove it even better. Not too many people with money sitting in the bank and all kinds of luxury items settle their debt, remember, you must have a hardship!
Never promise to settle an account and back up on a deal. Creditors hate this, be absolutely sure you are ready to deal before making promises. I have seen this type of action ruin excellent deals. Be true to yourself and your creditors do not lie to get great deals. Make sure to have some funds set aside just in case a really great settlement offer comes along or make sure those relatives and friends can lend you the money on short notice.
The above are three things to keep in mind when negotiating credit card debt and having the possibility to obtain great debt settlements, good luck!
Dan Delgado is an active unsecured debt negotiator, he has experience negotiating personal as well as business debt. For more information please visit http://www.pemperandgartle.com
