Debt settlement

I found it to usually be 15% of your total debt. Mine was spread out over my first 12 months, and it was only part of the monthly payment, so I was building up money to settle accounts with right away, also. I have heard some companies make you pay the entire fee first, which is not good.

is it worth it. I am having reservations. Don't know why. It's not like credit card companies care about me.

I have always said, settlements are not for the faint-hearted. You have to let your accounts go into default. Your phone is always ringing from creditors and collectors (caller ID is a must!) You still run the risk of being sued by creditors who aren't willing to wait. Typically your funds can only pay off one creditor at a time. But this is true if you settle on your own, outside of a program, too. Your credit score will drop like a lead balloon. (But it will do that anyway, if you aren't paying your accounts, or have too high of a debt-to-income ratio.) It all depends on what your situation is. Settlement programs are usually a last resort before bankruptcy. If you can consolidate or get into a debt management program, you are probably better off. But if you have no other choice, and don't want BK, then yes, settlement programs are worth it. A typical program is for 36 months. I am hoping to finish mine in 24, because I have been lucky and had some really good settlements. At that point, you can be debt-free and start to re-build your good credit.

There is no reason for you to pay an agency to do this. I promise you, you can do the same thing yourself. All companies will start automatically generating settlement offers to you once your account gets to a certain point. Take the money each month and put it in your own savings account (one that no creditor has ever done a withdrawal from). Let's say you set aside $500 a month - within 4 months you will have $2000. If you have 2 cards that have balances at like $3000, you could easily use the $2000 to negotiate $1000 settlements on those two cards -- maybe even less. Settlement agencies do absolutely nothing for you other than send the creditors stupid form letters over and over telling them not to call you - but the creditors can and will still call you anyway.... save the fee, you obviously can use it - once your accounts get far enough behind, you'll get the offers -- the same offers any company could have gotten without the hassle of dealing with what are many times shady settlement companies...