Is Debt Settlement Right For You?
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When you look at all of your bills, does it look like there is no way out? The worst thing you can do is ignore your bills. Instead take a look at the options you have.
If it is too much for you to handle on your own, reach out for a helping hand. There are professionals who are willing and able to give you solid advice. One of the options is debt settlement. Find a company that can resolve your debt if you decide this is the way you want to go. By resolving it you won’t be getting a 1099 so you have to pay income tax on the forgiven amount. For most people this way to get out of debt will take two years or less because you are paying back less.
How Do You Know If Debt Settlement Is Right For You?
Do you make your payments every month on time? Your creditors agree to take less than what you owe in debt settlement cases. Why would your creditors settle for less if you have been making your payments on time with no problem?
By getting behind it sometimes gives you the leverage you need to negotiate a settlement. Beware that if you decide to stop making payments your credit score will go down. Even if your credit is the lowest it has ever been in your life, it is possible to get it back up again. You might just be surprised at how fast your scores can rise.
Every company is different. There are some good and some bad. Most companies don’t actually resolve your debt, but will settle it so you will then receive a 1099 form showing the forgiven amount as income. Fees also differ from company to company. It is adding insult to injury. You will catch a break because you aren’t able to pay back the money you owe, but Uncle Sam will be right there waiting to collect. Seems like it’s the same as kicking a person when they are already down. Take a close look at what different companies offer to make sure you are getting what you want.
If you decide that debt settlement is not the right fit, you can also check into credit counseling or talk to a bankruptcy attorney. The most important thing is to make a decision and just do it. Don’t make things worse by ignoring them. Take action today to get out of debt and get your life back.