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Dept Repair Tips Which Debts Are Negotiable?
Dept Repair Tips Which Debts Are Negotiable?
Which Debts Are Negotiable?
| Which Debts Are Negotiable? |
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| Written by Administrator |
| Friday, 18 July 2008 10:26 |
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Most Unsecured Debts Can Be Settled. As mentioned before–probably numerous times–an unsecured debt is a debt where there is no collateral. Unsecured debts include medical bills, credit cards, department store cards, personal loans, collection accounts, student loans, amounts remaining after foreclosure or repossession, and bounced checks. There are a few creditors who will not compromise (utility companies rarely settle for less than the full balance), but most creditors will take a less-than-full payment as “settlement-in-full” to close a troublesome account. Secured, Collateralized Debts May not Be It is unlikely that you will be able to negotiate a settlement on any kind of secured loan. A secured loan is a loan which, upon default, has a piece of property which is repossessed by the loan company in order to recoup the costs of making the loan and the money lent. You will never find yourself looking at a charged off mortgage–your home will have been repossessed. The same is true for auto loans. If you have one of these types of loans, you can ask the creditor to rewrite the loan for the balance owed including all past due amounts with extended terms to accommodate a lower payment. You should also request that the new loan be at a reduced interest rate. Student Loans Student loans are a completely different kind of loan animal. In rare cases, fees and penalties might be waived in order to help a student rehabilitate a loan, but that is usually the limit. Do everything possible to prevent your debts from going to a collection agency Simply put, it is usually easier to negotiate with the original creditor. Avoid having an account turned over to a collection agency at any cost. It varies from creditor to creditor, but most credit card companies allow 180 days to 210 days before an account is charged off. After a debt is charged off, typically, the account is turned over to collections. While the account is considered a “past due” account and may be approaching the charge-off stage, it is often possible to prevent the charge-off by starting to make the normal monthly payment. This holds the account from going further past due. Many creditors will allow you to keep your accounts open or even to reopen closed accounts if you bring your accounts current. |
| Last Updated ( Friday, 18 July 2008 10:29 ) |