Inter Next Technologies, Inc., Internet Marketing Services, Reno, NV

Yes or No to debt settlement

Settling your debts with the creditors is the wisest way out, by which you can clear your financial backlogs and get out of debt burdens. It is thus one of the most important factors to negotiate with them in a convincing manner and make sure that they agree on an affordable settlement plan.

When does the Creditor say 'yes' to debt settlement?

Creditors are often seen to agree with debt settlements because they feel it is their only way to get back their money. The creditors feel that some amount of money is better than nothing. Don't ever bear the misconception in your mind that the creditor has agreed to settle your debts because he is basically a nice person.
Another indirect way by which you can influence the creditor to settle your debts is by hinting, that bankruptcy is the only other option left for you. However, it is not easy to convince them all the time. The creditors have their own ways to determine the authenticity of your financial condition.

What makes the creditor say 'no' to debt settlement?

There are several factors for which the creditor might disagree to settle the debts:

You are current on your payments: If the creditor finds that you are in a good standing for all the accounts of your credit report, then it is almost impossible to convince him of a debt settlement. If you warn the creditor of some future happenings like loss of job or medical emergency they hardly get convinced. There is a fair chance to convince them if you have a valid documentation which shows that your financial situation is insecure.
Your account has been active recently: Recent activity in your account like making charges and payments may make your creditors increase your settlement amount to a considerable extent.
Low settlement over an extended period: There is a limit to lowering and stretching your payment scheme. Most creditors will not agree to go for a 30% settlement offer payable over five years. They feel cheated and don't have any idea of what prevents you from sparing such a small amount. In such cases they want to avoid another hassle with your account. In case you offer them a full payment settlement offer they might agree over an extended period.
Sue you to recover the money: Another case where the creditor can refuse to settle debts with you is, if they have a legal upper hand to sue you. If they suspect you of making big bucks or enjoying a lot of assets, they have the right to drag you to court and garnish your wages. This can be done in less money than making a deal with you. Most probably you will be sued under such conditions.