The key question while a debt negotiation program is in process is what amount a debtor should offer the creditor. Each credit company has their own debt settlement policies. The settlement amount differs from one company to another. It is advisable not to argue with a creditor if he is immovable about lowering a settlement amount. Instead you should negotiate with patience and diplomacy while trying to settle on a particular amount. It is expected that you will be flexible and work out a settlement plan with the creditor.

One time offerings: It is for sure that you will always get a better deal when you are offering a bulk cash amount to the creditor.Again, there are chances that you might not get any deal from the creditor, if your offer includes a payment plan. If you have cash it is possible to have a 30%-50% reduction on your debt amount. With proper negotiation sometimes it can go even lower. However, this reduction is not guaranteed.

Plans to pay: If you don't have enough cash to offer the creditors you can opt for a payment plan . While negotiating about the payment plan it is recommended that you be honest and straight forward about your financial standing. Usually there are two types of payment plans:

• Short-duration payment plan: If you are capable of clearing your debt balance within a span of 3-6 months there is a possibility that the creditors will reduce your debts to an affordable amount. It might happen so, that your late fees and taxes will also be waived off by the creditor.
  
  
• Long term payment plan: Debt reduction companies have come up with a customer oriented plan known as 'Long term payment program'. This program helps to save a lot of time for the creditors.This program will help debtors who needs time to pay off their debts. In this program the creditors usually gets 1-5 years to clear their debt amounts. Recently some credit companies have scheduled a maximum time limit of 1 year to be on their long term payment programs.
  
  Long term payment plans can trigger your interest rates as high as 20%.The longer you take to pay your debts, the more amount of money you have to shell out to the creditor. At the same time you cannot start on restoring your financial status until all your loans are settled. It is thus ideal to squeeze out money to the maximum from your monthly expenses and repay the creditor to lead a peaceful life away from debts.