Credit card debt can take a serious toll on your cash flow. The allure of advertising that offers to “eliminate all of your debt” quickly is tempting. Known as debt settlement plans, these debt strategies seek to negotiate a settlement with your creditors to get them to accept less than the full amount you owe in exchange for immediate payment of the lesser sum.
Is a Debt Settlement Right for Me?
If you’re wondering, “Is a debt settlement right for me?” then it would behoove you to look carefully at the pros and cons. If you are in such a dire financial situation where you begin to think that bankruptcy is a viable option, debt settlement can be attractive. However, all things come at a cost, and when that cost includes bankruptcy, it’s especially important to make sure it’s worth it before diving in.
Debt Settlement Pros and Cons
A debt settlement pros and cons list begins and ends with one powerful “pro”: You can stand to save large amounts of money if you can strike a deal with your creditors. For instance, say you owe $28,000 in credit card debt and you successfully negotiate a $15,000 settlement, you effectively save $13,000 immediately.
In exchange, the “con” list is somewhat longer:
- Might pay high fees
- You will owe taxes on the $13,000 because the I.R.S. views such reductions as income
- Credit report implications are same as bankruptcy
Debt Settlement Help for Every Situation
If you are thinking about getting debt settlement help, you should reach out to the experts at Americor Financial to discuss the full range of options available to you when it comes to devising a debt solution that will work for your individual situation. Here at Americor Financial, we are experienced with an array of debt reduction strategies that are designed to help you escape the tight grip of consumer debt.