Image via WikipediaDebt settlements have seen a significant increase in volume since the passage of Obama's financial stimulus bills. Most of the stimulus money went to large financial institutions but the money is clearly helping consumers in need of debt relief. Creditors are using this stimulus money to mitigate their losses they are incurring with debt settlements. The stimulus money basically gave the creditors much more flexibility in negotiating debt settlements and they are currently agreeing to very generous settlements. This article will teach consumers how to take advantage of federal stimulus money to get a favorable debt settlement.
The stimulus dollars are indirectly helping consumers eliminate a percentage of their debt through a debt settlement. Creditors not only have millions of stimulus dollars to play around with but they are also agreeing to such generous settlements because they are fearful. They are down right scared that delinquent accounts are going to continue rising at record levels. Creditors of unsecured debt such as credit card companies are left with nothing when a consumer defaults. They have no asset backing up the credit like a mortgage or car. Credit card companies and other holders of unsecured debt are therefore agreeing to settlements as low as 20% of the original balance.
Every case is different but a legitimate debt settlement company will be able to eliminate at least 50% of your unsecured debt on average. This largely depends on how long you have had your debt for. Generally, the longer you have had the debt the more favorable settlement you are likely to receive. Getting favorable debt settlements also depends on how effective your debt company is. This is why it is critical that consumers know how to find a top performing company.
If you want to get out of debt and hire a debt settlement company for debt negotiation then I have an important piece of advice. Do Not go directly to a particular debt settlement company but rather first go to a debt relief network who is affiliated with several legitimate debt companies. In order to be in the debt relief network, the debt settlement companies must prove a track record of successfully negotiating and eliminating debt. They must also pass an ethical standards test. Going through a debt relief network will ensure that the debt company you are provided with is a legitimate and respected company. This is the most efficient way in finding the best debt settlement companies and increasing your chances of eliminating your debt.