So, the advertisement reflects “now settle all your debts for half of what you presently owe, with the assurance that your credit score will not get affected”! Is it true to the core? Most probably not! Be very careful with these advertisements. You can end up falling into bigger troubles, with these debt settlement scams. Nearly 90% of these ads make false claims regarding debt settlement issues. You need to consider the consequences and focus on reliability of the information before approaching any debt settlement firm.
Can debt consolidation be an option to consider?
Debt consolidation is an approach towards managing financial burdens. However, the general guidelines must be followed before making an approach. Although it is true that the consolidation concept has received much attention off late, one cannot ignore the various techniques and details that are associated with the process. Opting for debt consolidation is a better option than declaring bankruptcy, especially when trying to make efforts to protect your credit score. Before opting for consolidation plans, you must keep in mind that the pending debts are not going to be eliminated at all. Debtors need to check on their money spending habit. Spending more than their earning can worsen the situation. In such scenarios, the consolidation strategies do not have any positive impact on improving the financial scenario of the debtor.
You can opt for debt consolidation, only if there are no more options left. In general, there are different types of debt settlement options available. The consolidation part should be approached as the last resource to settle your financial account and clear you from the burdens of pending debts.
Becoming too concerned on credit score rating
A lot of people are too concerned, with their credit scores and credit ratings while looking for options to eliminate debts. They often overlook the debt settlement reviews and fall prey to catchy ads. Yes, the debt settlement process can hurt your credit score. But, then, what more can you do to get rid from the burdens of debt? In any debt settlement process, the lender is required to report the debt as delinquent or possibly charged off. In case you are sued, a negative impression and public record entry is made to your credit report. Additionally, the pending amount that you presently owe the creditor will be revised (read, increased) because of legal expenses, penalties, interest and fees.
If you are planning to try your luck on debt settlement plans, you must first consult a reputed attorney. You need to have a detailed face-to-face discussion, with the attorney to discuss your present financial condition and pending debt status. The legal professional may provide sound advice while opening before you the legal rights you are entitled to avail in debt settlement scenarios. They may also suggest you options regarding debt settlement firms and services available, within your reach.
Author Bio: Antony Philip is a legal claim settlement expert and financial advisor. He has worked for several credit counseling firms. He also writes regularly on several blogs related to debt settlement reviews.