Debt Settlement Kirkland WA call 1-888-505-2369 and speak to an experienced lawyer for more information.
Debt settlement occurs when the consumer stops making
monthly payments to creditors and the creditor offers to ‘settle’ the
debt at a reduced amount as “payment in full”. The problem is when
consumers have too much debt and no savings to afford to pay a lump sum
amount even if reduced to settle the debt.
Chapter 7 bankruptcy wipes out most unsecured debt and is usually over
within four months. People who file chapter 7 bankruptcy get a fresh
start that allows them to begin rebuilding their credit immediately.
They no longer owe their creditors, and the upfront cost for filing is
usually around $900 to $1,500 -- far less than the cost of debt
The offer by creditors to settle their debt is usually the last step before the creditor files a lawsuit in court against the consumer. Unless the consumer can afford to pay a lump sum amount to the creditor to settle the debt it is best to file bankruptcy and avoid legal proceedings including wage garnishment.
The dangers of using a debt settlement company are many, including:
Fraud. Some Kirkland WA debt settlement companies offering debt settlement are fly-by-night scams, eager to take big upfront fees and then disappear. Other debt settlement Kirkland WA companies are too inept or inexperienced to negotiate effective deals. Either way, the result is the same: money down the drain at a time when you can ill afford the loss.
Credit score damage. Failing to pay your bills on time will trash your credit scores. The better your scores, the greater the toll. Settling a debt for less than what you owe may do additional damage.
Lawsuits and wage garnishment. Creditors increasingly are using debt collection law firms that are quick to file lawsuits when borrowers default. A successful lawsuit can lead to wage garnishment or liens on your property. In fact, some creditors are so resistant to working with debt settlement companies that they immediately "go legal," or file a lawsuit against a debtor as soon as they are contacted by a debt-settlement company.
Lack of regulation. The federal government Kirkland WA doesn't regulate debt-settlement companies, and the Federal Trade Commission has implemented some rules and held hearings for Kirkland WA debt settlement laws.
Taxes. The difference between what you owe and what you pay in a debt settlement typically is considered taxable income by the IRS. So if you're in the 25% federal tax bracket, you could owe $2,500 for every $10,000 in debt that's forgiven. So be careful, you could be stuck with a five-figure tax bill.
Cost. Debt settlement isn’t cheap. Some companies charge 14% to 18% of the total face value of the debt you want settled, while other Kirkland WA debt settlement companies require a large percentage of the amount they actually settle for you.
Time. In addition to not being cheap, debt settlement typically isn't fast. The average Kirkland WA debt settlement process takes closer to two years, according to many debt settlement professionals.
Bankruptcy is cheaper and faster. Clearly, if you can't pay your bills and you can file a Chapter 7, that's a better course than debt settlement call 1-888-505-2369 and speak to a lawyer for more information.