What is the minimum payment I have to give to a settlement company?
The minimum payment that you have to make depends on your outstanding balance and how much you’re capable to pay each month. However, you need to put a certain amount in the escrow account (the account that is opened by the settlement company in your name) after which the company can start negotiating your creditors.
When you approach a settlement company, it assesses your financial condition and decides upon how much you can pay every month. You need to pay that amount to the settlement company every month. If you make the payments regularly, you'll be able to become debt free within the said period.
Better yet don't listen to the advise above. Some debt settlement companies will know the settlement parameters of the creditor or better yet there might be circumstances where the creditor will go extremely low. As a former collections manager for a large creditors right law firm i have seen creditors accept less than 20 percent. There are some very seasoned colector's out there that will rip to shreds and some very seasoned debt negotiators that will save you plenty of money.
You can try settling debts yourself. Just remember a few points.
Creditors/debt collectors are less likely to cut off a big portion from your balance initially. You need to hold your patience and negotiate harder. Collectors may also try to make you emotionally upset so you pay a bigger amount. You need to be calm and stop yourself from being influenced.
Go to settle bank debt. They have the lowest fees and are the most reputable in the industry. You can do it yourself, however there is nothing like a seasoned pro in your corner that will save you money and knows the creditors settlement parameters.