Millions upon millions of credit card consumers have eliminated their debt by negotiating a settlement with their creditors.
It is no surprise that more and more people with overwhelming amounts of revolving unsecured debt have turned to debt settlement as a debt solution.
You may very well be considering debt settlement as an alternative to bankruptcy and as a means to climb out of a financial hardship. You may be able to obtain a debt settlement offer easily. However, this is unlikely.
Lenders do not just want to give away their entire account receivables. With this notion in mind how are you suppose to convince your lender to forgive 30% – 80% of the outstanding balance on your credit cards?
No one can give you a definite bullet proof solution or answer to this question.
Just the same there are some time tested concepts that proven themselves effective over time.
This article lists three key principles to obtaining a debt settlement agreement from your lender.
3 Key Aspects to Debt Settlement
Settlement Fund to Offer Creditor a Cash Payment
The very nature of debt settlement implies that the borrower needs to have the means, willingness, and ability to make a large cash payment to the lender. The reason for this is simple.
The key reason and incentive for a lender to agree to collect less than they are owed yet still forgive the remaining balance is the large upfront cash payment that is agreed upon in the settlement offer.
Finding a Willing Agent and Source of Authorization Representing Your Creditor
A debt settlement can only be realized if the creditor agrees to the offer. This means that a decision maker with in the creditors organization who has the authority to approve a settlement offer must be found and contacted.
Without the cooperation of a decision making agent no settlement will ever be reached.
Obtaining a Written and Signed Agreement
If you get the approval for a debt settlement offer but are unable to get the offer in writing then you have no settlement offer. Period.
You need to get a signed written agreement outlining the terms of the debt settlement offer prior to sending in any type of payment.
Learn More About Debt Settlement
If you want to learn more about debt settlement and obtaining a settlement offer from your lender then I suggest you continue your research with some of the helpful resources below.
Debt Settlement Resources
DIY Credit Card Debt Settlement – This is a nice and simple five step DIY debt settlement plan that was published on Young Finance Guy (a finance blog on Blogger).
Debt Help – This is a online debt help resource with tons of good information on resolving problems with consumer financial obligations.