Do it Yourself the Alternative to Attorney Based Debt Settlement
If bankruptcy is a real risk because you are deep in debt. Then you are most likely trying to find out what your alternatives are. One of the possibilities is to get a debt settlement attorney, but that might be a very costly affair and you risk ending up spending most of the money you save on legal bills. The good news is that you can actually settle your own debt and save the attorney fees, but you need to know the risks and how to go about. This article will provide the information you need to decide if you want to go down that route and how to do it.
Know where you stand
Step one is to face the facts about your situation. You need to know exactly where you stand before you start to contact your creditors and start the negotiation. This can be painful, but it is a necessary step and if you skip it you will likely make costly and avoidable mistakes later on. To do this make a list of all your debts and add up the total amount of debt you have. Next note if the debts are secured (ex. mortgage and tax debt) or unsecured (ex. credit card debt and medical debts) and priorities them (secured debts are more important than unsecured). And finally get your credit report to see who owns your debts. They might have been turned over to collecting agency or another company. Add the owner of each debt along with contact information to your list.
Prepare
Now that you know where you stand it’s time to prepare to contact your creditors one at the time. Before you actually get on the phone it’s a good idea to have a plan. First of all you have to come up with an offer for how to settle your debt. This can either be a lump sum or a monthly payment. The lump sum is preferable if you are able to come up with the money because it can get you a better deal. A onetime 40% to 60% payment is what you want to aim for. Also make sure that they stop all fees and high interest on your account. Present them with a specific time plan on how and when you will be able to pay. And remember your creditors are not likely to discuss a settlement unless you are at least four to six month behind on your payments. So if you aren’t behind already you have to stop paying and if possible start saving up money for the settlement. A last thing to do before the call is to get a copy of your latest bill in front of you.
Contact your creditors 
When you call your creditor avoid profound language. You are trying to make a deal and that’s easier if you get along with the other person. Also the conversation might be recorded. Inform them that you are trying to solve the problem and want to speak to the person in charge of settlements. If you happen to get a person on the other end that doesn’t want to cooperate at all come up with a reasonable excuse to get off the phone and call back later. The alternative is to write a letter outlining your offer and time plan. Make sure to get the deal in writing if you make one. In the case of a lawsuit you need to be able to prove a deal has been made.
As you can see making your own settlement is a serious alternative to attorney based debt settlement, but there are some risks and a fair amount of work involved.
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