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DIY or Settlement Company?

Date: Thu, 10/01/2009 - 23:10

Submitted by anonymous
on Thu, 10/01/2009 - 23:10

Posts: 202330 Credits: [Donate]

Total Replies: 5


My husband and I currently have a large amount of credit card debt on 14 different cards. We have had this debt for several years, as we are only able to make the minimum payments on our accounts. We are tired (and somewhat unable) of making payments of over $1500 a month only to see that our debt is not budging. We need advice: should we go through a debt settlement company (we've been researching Superior Debt Services in CO.) or try to settle the debt ourselves? Also,if we went the DIY route, will the credit card companies or collection agencies settle on an amount and accept it in monthly payments, or will they only accept settlement payments in lump sums?


That is a question a lot of people ask. The answer is, it depends. You should do what you are comfortable with. I look at everything from a cost benefit analysis. How much is it going to cost and what is the benefit? Doing it yourself will save you a lot of money in fees, but there are certain benefits to have someone that negotiates with creditors every day. So nobody can tell you what approach is best for you. Just be careful if you do hire a settlement company because most of them charge way too much money, want to much or all of it upfront, and can actually get you into more financial trouble. So make sure to take your time and research many companies and options before making any decisions. Unless you are currently dealing with a lawsuit, which it doesn't sound like you are, you have plenty of time to research and make the best decision for you and your situation.


lrhall41

Submitted by Damon on Thu, 10/01/2009 - 23:27

( Posts: 80 | Credits: )


Damon, thank you for your quick response and advice. With two young kids and a potential for 14 different CC companies calling every day, I think our best option is to go with a settlement company. We have recently been talking to Superior Debt Services. They charge a fee of 15% of your total debt and collect it in payments over the first 20 months or so. Does this sound like a good arrangement, or can we do better? If so, do you have any recommendations?


lrhall41

Submitted by on Thu, 10/01/2009 - 23:59

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Your welcome,

I refrain from making specific recommendations unless I have the overall financial picture of my client. The reason being is that sometimes given the circumstances, debt settlement may not even be the best approach. Also different companies have different benefits and I can't actually make a good recommendation unless I understand what the clients expectations are, and which things are the most important to them.

That being said, my personal opinion is that the fee structure you outlined, doesn't make a lot of sense from a consumer perspective. I prefer a company base their fees on performance.


lrhall41

Submitted by Damon on Fri, 10/02/2009 - 00:08

( Posts: 80 | Credits: )