Unsecured debt ~20k or a little more

You will find most people here are either in the same situation or have been in your situation. There is a way out. I would suggest taking advantage of the free consult you can receive from this site. They may beable to give you some insight in what you can do and what effect it will have on your credit report.

What I understand debt consolidaton will have some impact but not as bad as debt settlement. I went the settlement route with a settlement company and my credit is pretty much in the toilet right now. Read as much as you can on these boards. There is alot of advice here and smart people that will help you through the process.

You have taken the right steps by admitting you have a to make a change.

I hope everything works out for you both with your debt and most of all with your marriage.

I'm currently settling my credit card debt. You have to be delinquent in order to settle debt, usually 90 to 180 days past due to get the best settlement. The phone will ring all day. I have five creditors and they call daily; sometimes 5 times a day, I installed an ID machine that sends the annoying callers right to my answering machine without a ring. It is very upsetting, I will talk to them and then they will call three times again, the same day, just harassing. So I wrote up a call schedule to call them at certain points of delinquency. I started calling at 60 days and then at 89 days and then it will be every 30 days after that until they settle. If you have a true hardship and you can't continue paying, take care of it now before it gets beyond you. I was able to borrow from my 401K to take care of most of this, I saved some and will get a tax refund. I planned on 50% of the total debt knowing I would settle for less. If you can't come up with the money in 24 months it probably is not a good idea. If you can settle it in six months, that is the best since you want to settle with the original creditor. Collection agents and junk debt buyers are harder to deal with. You can settle your own debt and most creditors prefer to hear from you. Read the Do It Yourself section on this site, research, research and research some more before you make the decision.

Regarding your credit, it is a hit to your credit, it will stay on your credit for 7 years but it generally affects your credit score for only about 24 months. At least it is not a bankruptcy that will stay on your credit for 7 to 10 years as a public record.

I would take the free consultation first to see if they can assist you with reducing payments/interest etc. If you decide to go the debt settlement route I would suggest doing this yourself. You will save a lot in fee's and be able to put that money towards settlements. Some settlement company's will charge up to 15% which is 3K - with that amount you could possibly already have some of these settled. The phone calls do get alittle annoying, but I have settled two of my accounts already and the money I saved was well worth dealing with the calls for 5 months. This will affect your credit but I am noticing my credit is already improving once I settled the two accounts. You can read more of my journey and what I dealt with on my blog.

Amigo:

I can answer your question exactly.

In a nutchell, a good debt settlement program works like this:

You choose to stop sending monthly payments to your creditors and instead send that to an account in which you are saving for settlement. Fees are also collected along the way. While you save, your debt settlement company will negotiate with your creditors. Once they have come to an agreement with your creditor and you have accumulated enough $ to settle an account, they send the reduced amount to the creditor to satisfy the debt. Then the cycle starts all over again until the next account is settled ans hopefully util all your accounts are settled...

Therefore, in one hand, each account you enroll will be delinquent until the day it is settled.

In the other hand, clients who stick to a good debt settlement program usually end-up paying back 50% (give or take) of what they originally owed at the point of enrollment. The how long the accounts will be delinqued (how long the program lasts) will depend on how fast you can save for settlemet.

In my opinion, there are not too many good companies out there so please be diligent in your research.

Sean McCabe

Debt Shield, Inc.