There are many different kinds of debt. Some of the most common debts are federal student loans, home equity loans, mortgages, private student loans, car loans, payday loans, and credit card debt, just to name a few.
There’s what is considered “good debt”— low interest rates and high long-term benefits — and “bad debt” — high interest rates and low benefits.
The goal is to pay down the bad debt and build up an emergency fund before moving on to investing. If you have debt, but it’s good debt, you can start building your investments and paying down your mortgage faster. Most people are paying down debt, saving, and investing at the same time.
Before figuring out how to get out of debt, it’s a good idea to know what your options are. Debt resolution is a common strategy for paying off debt faster by working with your creditors. Debt consolidation is another strategy.
DebtBlue offers free evaluations to better understand your current situation and discover the debt solution that’s best for you. Call DebtBlue today for your free, no-risk evaluation.
What Is Debt Resolution?
Debt resolution is basically another word for debt settlement, also known as “debt reduction,” “debt adjusting” or “debt negotiation,” something we are experts in.
DebtBlue is a debt resolution company. That means we take the time to listen to your specific situation, understand how much debt you have, and then negotiate with your creditors on your behalf to get them to forgive, settle, or take an offer for less than you owe.
The debt resolution process involves persistent negotiating with banks and lenders. While a knowledgeable person comfortable with haggling can negotiate with the banks to forgive a large amount of debt, certified debt specialists can probably get you a much better deal.
The qualified debt counselors at DebtBlue have the confidence, determination, and patience to considerably reduce your debts. If you want to reduce your debt by half or even more, speak with DebtBlue to find out if debt resolution is right for you.
Which types of debt can be reduced?
- Personal loans
- Payday loans
- Credit card debts
- Cell phone and utility bills
- Apartment leases and some mortgage balances
- Private student loans
- Medical bills
- Car loans
- Unsecured lines of credit
- Accounts in collection
Keep in mind that some types of debt cannot be settled for less than the full amount, including child support, alimony, and in most cases, student loans, home and auto loans. In some cases, you may be able to settle your tax bill with the IRS, however settlements are normally limited to the types of debt listed above.
If debt resolution is right for you, we will negotiate settlements with your creditors for significantly less than what you owe. From start to finish, our expert negotiators fight for your best interest. We work for you to get the best savings possible.
Benefits of Debt Resolution
- Significantly reduce what you owe
- One low monthly payment
- Get rid of your credit card debt in 36 months or less
- Not reported on your credit file
- Results are guaranteed or you pay nothing
When you use a Debt Resolution firm, professionals negotiate with your creditors on your behalf. We take the hassle and stress off your shoulders and begin to work strategically for you to help you save the maximum amount possible.
Advantages and Disadvantages of Debt Resolution
The major benefit of debt resolution is that is can significantly reduce your debt. A good debt negotiation strategy can get you debt free within a few years. It is considered a last resort strategy before declaring bankruptcy. While debt negotiation can be a great solution for slashing your debt and gaining financial freedom, there are some downsides.
Here’s what you should know before settling your debts:
- If you are unable to pay the full amount of your debt, your creditors may pursue litigation.
- Settled debts will hurt your credit score. Instead of saying “paid in full,” your credit report will get updated to “settled,” which can impact your ability to get a loan in the future. Your settled debt can remain on your credit report history for seven years (FTC). Still, it’s much better than bankruptcy or defaulting on your loans.
- The loan amount that the bank “forgives” is considered taxable income. The IRS expects you to pay income tax on the remaining debt. It’s important to keep this in mind when calculating your potential savings.
- Debt resolution companies charge a fee for their expert negotiation services.
Debt resolution isn’t for everyone. You have to be in a pretty serious financial situation for lenders to consider forgiving a portion of your debt. If lenders do not believe you are struggling as much as you claim, they may not be willing to settle.
Debt settlement may be avoidable. Speak with DebtBlue’s certified debt counselors if your feel yourself sinking in debt. We offer free advice on how to improve your financial situation.
What a Debt Resolution Company Does
A debt resolution company negotiates on your behalf with the credit card companies to have a portion of your debt forgiven for good. The debt settlement process can take months to complete. After a lot of perseverance, the creditors will agree to settle for an amount that is much lower than what you owe, normally with the condition that you make the settled debt payment within a short period of time (normally, 2-3 months).
Everyone is unique. DebtBlue will set you up with your own certified debt specialist to find the right debt solution for you and your financial situation.
Contact DebtBlue for your free, no-obligation consultation that explains all of your options.