Save Money by Negotiating Your Debt Settlement Yourself
If you have debts that are troubling you, you may have heard about debt settlement. You may also have read that only debt settlement companies can negotiate with your creditors to settle your debt.
It is actually possible and sometimes even advisable for you to negotiate for debt settlement on your own. Your creditor will appreciate learning about your financial situation from you and might even be willing to cooperate with you more due to your forthrightness.
Debt settlement involves making a lump sum payment. You will need to negotiate what that lump sum amount will be. You will then need to start raising the settlement amount you have agreed upon with the debt settlement company.
It might take a while to reach an agreement therefore in the meantime you can negotiate for the card to be cancelled to prevent further accrual of interests and late payment fees. Insist on getting this communication in writing.
By negotiating on your own, you will:
Save on fees
When you hire a debt settlement company to negotiate on your behalf, you will have to pay for their services once the company settles your debt. This will mean that a significant percentage of the money you have been contributing to the special purpose settlement account will be used to pay the debt settlement company.
If you are negotiating on your own, you will not pay any fees. Furthermore, the amount in the account will attract interest; therefore you will gain in two ways.
You’ll learn debt management skills
If you succeed in getting the best debt settlement on your own, you will have learnt some useful skills that will help you use your credit cards wisely in the future.
When you have debt management skills, you will automatically find that you are not wasting your financial resources. You will also be able to live within your income and still be able to put some money away.
However, if someone else negotiates on your behalf, you will be a secondary party in the process and will therefore not internalize any skills that could help you manage your money well in the future.
What it takes to be your own debt negotiator
Being your own debt manager contributes a lot to knowledge of your own finances. Though the debt settlement company will work to get you a good deal, only you can have your best interests in mind.
To be your own debt negotiator, you have to take into consideration some factors:
- Will you find the time to learn good negotiation skills?
- Consider how long it will take you to learn everything you need to know about debt settlement.
- You need direct access to key decision makers within the credit card company.
- Gain access to and read your credit report.
- No detail about your financials is minor. If you are in financial strife, compile everything that will support that position.
Prepare yourself by taking these factors into consideration. There will be some risks involved, but if your approach pays off, you will find that you have made significant savings.