Handling Debt Settlement Like A Pro #1

: Chris Lee Law Firm

  Filed under: Debt settlement

debt settlementDebt settlement is not a uniform process like bankruptcy. Instead, every lender will have different practices regarding delinquency and settlement. Lenders will not show enthusiasm to settle for so much as a penny less in most cases. Here are a few things you should know when trying to settle large, outstanding debt.

  • Lenders’ internal rules and debt settlement practices are often very different. Some debt-settlement strategies may force one lender to back off and settle for less. With other lenders, these strategies may only set off alarms, potentially resulting in a lawsuit.
  • If your account is sent to a lawyer, this doesn’t mean you are going to court. In many cases, lenders and banks are preying on the legal ignorance of their borrowers, and using attorneys as a means of bullying them into paying their debts. This may be a scare tactic on the part of the lender. Read the fine print of any mail received from a law firm carefully. If unsure, get professional help.
  • Know how your lender has handled debt settlements in the past. If you want to avoid prolonged, costly litigation over overdue debt, be smart when playing ball with the lender—know how they have handled cases similar to yours in the past. This will be a good indicator both of what their letters and legal threats mean, and what they will ultimately settle for.
  • If a lender has a track record of suing borrowers in the past, you may need to get an attorney on your side.  A financial attorney can represent you and help you negotiate the best deal. Again, however, many lenders use and abuse the specter of a lawsuit to frighten borrowers into paying off outstanding debts.

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