| When your finances seem to have overtaken your life | | | | Write to each of your creditors or the collection |
| and you find yourself unable to make your payments | | | | agencies handling the account if it has already been |
| each month, before you decide to declare bankruptcy | | | | moved to collections and explain your situation to them. |
| you should attempt to obtain debt settlements with | | | | Explain that your financial situation has changed, and |
| each of your creditors. A debt settlement is when a | | | | you are very close to declaring bankruptcy and are |
| creditor agrees to accept less than the total balance | | | | unable to make payments as originally agreed. |
| owed in a lump sum payment, in order to close out the | | | | Tell each of your creditors the total amount of debt |
| account and have it reported to the credit bureaus as | | | | you owe, and how much you have available to pay |
| paid. | | | | off that debt. Explain how much you can pay on your |
| Many people don't even consider debt settlement an | | | | account with the creditor and let them know you are |
| option, but you would be surprised how easy it actually | | | | sending the offer to each of your creditors- and that |
| is to get a creditor to settle with you if you have a | | | | the ones who agree to your offer are the accounts |
| history of making your payments late, or if you | | | | you will focus on paying off first! This might encourage |
| consistently miss your payments all together. Creditors | | | | them to agree! |
| would prefer to receive part of the money owed to | | | | You will hopefully receive a few acceptance letters. |
| them than none at all, which is what they receive if | | | | You are also likely to receive a few rejections from |
| you were to file bankruptcy! | | | | creditors who are unwilling at this time to accept a |
| There are debt settlement companies that can help | | | | debt settlement. Keep a copy of all letters in your |
| you, but in many cases, you can get your creditors to | | | | records, and for any creditors that agreed with the |
| settle with you on your own. Try the following steps | | | | debt settlement offer, send them a payment |
| for obtaining a debt settlement and paying off your | | | | immediately as long as you have in writing their |
| debt with the least amount of money and in the least | | | | agreement. |
| amount of time. | | | | Each month, you can repeat the process and send out |
| First, determine how much you can pay to settle your | | | | new letters to the creditors who have not yet agreed |
| total debt. Figure out what your absolutely essential | | | | to your debt settlement offers. You'll have higher |
| monthly expenses are, including rent or mortgage | | | | percentages available to pay towards the debt now, |
| payments, food, medical expenses, etc. Subtract your | | | | as you have begun to pay off some of your debts |
| total expenses from the amount of your net pay and | | | | and you will increase the number of creditors who |
| whatever you have let over is the amount you have | | | | agree to settle. |
| available to pay towards a debt settlement plan. | | | | Just be sure that you insist on getting agreements in |
| Next, make a list of all of the creditors you owe and | | | | writing- because there have been some creditors that |
| are late paying, and how much you owe to each | | | | agree to the debt settlement offers on the phone and |
| creditor. Determine and write down how much of your | | | | then once they receive your payment, they deny ever |
| debt settlement budget you can pay towards the | | | | agreeing to the debt settlement offer in the first place! |
| account. | | | | |