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What are the Pros and Cons of Debt Settlement?
Filed Under (Credit Card Debt, Debt Help, Debt Settlement,) by admin on 08-09-2010

Any choice in life has pros and cons.  Credit card debt is no different.  Choosing to settle your debt for less than what you owe has some definite pros.

Pros:   Debt Settlement Save Time and Money.

  • Typically, debt settlement programs last from 2 – 4 years.  
  • Debt is usually settled for less than the principal balance.  This means that a significant amount of interest is saved over the life of the debt
Cons:  Impact of Debt Settlement
  • Debt Settlement will impact your Credit Score
  • You can expect to get phone calls from creditors
  • It is possible that a creditor may attempt to take you to court. (a good debt settlement company will have systems in place to lessen the impact if this happens)  Historically, this occurs with about 2 – 4 % of individual accounts enrolled.  Some creditors have admitted that they would rather settle than attempt legal action.
In many cases, the financial benefits outweigh the short term inconvenience and impact of creditor calls and even the risk of legal action.

To find out how the programs will work for you, request a debt analysis.  One of our qualified debt consultants will go over your details so that  you can make the best decision for your unique situation.

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