Debt Settlement Pros and Cons
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Debt Relief – How It Works
Over the years one of the most common questions we get from people who come to our site is "How does it work?"
This video explains how the free debt relief savings estimate works, how debt relief programs work and if there is any cost.

Debt Settlement Pros and Cons

Debt settlement is a debt relief option that has become increasingly popular among people who need relief from high-balance credit cards (typically $20,000 to $125,000 or more). Through debt settlement, debt specialists negotiate with creditors on your behalf – with the goal of "settling" your credit card debt for substantially less than you currently owe.

Pros of Debt Settlement

  • By settling debt, you can save a substantial amount of money
  • Can help you settle credit cards in as little as 12-36 months
  • Allows you to make low monthly payments you can afford
  • Settles debt and provides alternative to bankruptcy
  • While negative to credit, not as severe or long-lasting as bankruptcy
  • Unless "attorney-based" fees only paid after successful settlement

Cons of Debt Settlement

  • Typically only benefits those with high-balance credit cards
  • Amount of money saved through debt settlement subject to taxes
  • Requires discipline to "set aside" money for successful settlement
  • Creditors may threaten, or take, legal action to collect debt
  • Negative impact on credit due to default on credit agreements
  • Creditors may not agree to accept your debt settlement offer

Summary: What to Expect with Debt Settlement

If you have one or more high-balance credit cards and are going through financial hardship – credit card companies may agree to "settle" your credit card debt for substantially less than you currently owe.

How does debt settlement work? A debt relief specialist will review your current credit card debts and the amount of money you can afford to set aside each month to accumulate a "settlement fund". Debt specialists will then negotiate with credit card companies on your behalf with the goal of settling debt for substantially less than you currently owe.

How much debt settlement could potentially save depends largely on the amount of credit card debt involved, your current financial circumstances – and the settlement policies of credit card companies.

It's important to understand that, just as no two debt situations are exactly alike, no single debt solution is right for everyone. Your debt specialist can provide more details regarding debt settlement or debt negotiation as part of your free debt relief analysis and savings estimate.

Important: Please be advised that every debt situation is unique. A free debt relief evaluation can provide you with an overview of your debt relief options, your total projected savings, your savings each month, and the projected time to reduce or resolve debts. Your debt relief savings estimate is free with no obligation.
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