Debt Management
Managing money is a difficult task, and we often stumble into the loop of debts. Taking the help of a loan, to upgrade our lifestyle or come out of a financial crunch sounds a good option. But often we get into the cycle of debts one after the other, leading to a severe burden. One debt leads to another and the next another and it becomes a road with no destination. Debt settlement agencies come into the frame at such an instance when we wish to finish the debt and be free. It seems a great initiative to have someone else pay our loan, but debt settlements have their own set of pros and cons. Advantages and disadvantages that go hand in hand.
Debt settlement is often confused with Debt Consolidation. But they are two different practices. Debt consolidation the practice of combining all debts and taking a further bigger loan at a lower interest rate to finish all the small, scattered loans. And debt settlement is directly someone else pays for our loans and we pay them a specific fee.
Pros of debt settlement:
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Reducing the loan amount:
The main aim of debt settlement is to reduce the burden you are carrying on your shoulders and give you a little space to breathe. The loans are not getting waived off, but just the amount is lowered into a considerable sum that you can pay and finish it off quickly.
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Saves from Bankruptcy:
Debts and the prospect of debts due to the present one is a dangerous cycle. As it is rather hard to completely get rid of a debt cycle and lead a simple relaxing life. Constant repayments push people into deeper debts. This makes it extremely hard to break the cycle and come out free. It might lead to bankruptcy in many cases. This is prevented and saved by debt settlements and a ray of hope for a better life is seen.
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Proper Health and Lifestyle:
Once a debt settlement is done, there is more to it than just finishing from the debts. A lesson is learned, and slowly the lifestyle, and health gets improved. They get better for the good.
Cons of debt settlement:
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The cycle deepens:
Although many debt settlement programs do promise negotiation, and complete solutions to debts, they do not guarantee to do so. Many creditors often do not wish to negotiate and decline all offers and claims by the settler. Thus, there is no guarantee of getting out of the situation, but adversely, it might lead to getting into more debts due to the charges by the forum.
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No guarantee:
Trust is a factor that is a prerequisite in such cases, and we need to trust the agency no matter what. But a lot of debt settlers do charge a fee for their negotiation and help but do not promise a surety that the debt would be waived off.
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A negative impact on credit score:
While a settlement program is undertaken and the negotiations are going on, the settlement company often advises, to not pay any installments until the talks get to an end, but this might not reach the knowledge of the creditor. This leads to a direct impact on the possible credit score.
Why choose Debt Settlements?
Debt settlement has an equal share of possibilities that lead to a varied scope of advantages and disadvantages. But ultimately it is the company chosen that would make all the difference. With many agencies to choose from, caution should be maintained in order not to fall into any fraudulent company.
Credit my Debt, is a debt settlement company in New York, that can help people suffering and looking for ways to get rid of a burden they’ve been suffering from for long. Credit scores and all possibilities of getting another loan reduces with not being able to finish off the present loan on time. This is where Credit my Debt comes into play and helps one to be free and ultimately be eligible for future necessities. No doubt, settlements can go wrong but making the right choice with the agency, would change the course in a positive direction.