Debt Negotiations

Roughly 1.2 million households were lost due to foreclosure during the recession despite government efforts to assist struggling families. Losing a home is undoubtedly one of the most unfortunate things to happen to a family, and the pain and confusion for children in these situations only make things more complicated. However, there are many ways for families to go about debt negotiating to avoid the dangers of foreclosure and bankruptcy.

All debts can be separated into 2 different categories, secured and unsecured. Secured debts are those that have a tangible asset or property tied with it such as a house or a car. The contrast are unsecured debts which include many service bills like credit card debt or service bills. When a person begins to struggle financially, whether it is falling behind on mortgage payments or incurring thousands of dollars worth of medical bills, that person is forced to begin to utilize credit cards more and more just to get by. It is estimated that a average household has 15000 dollars worth of credit card debt and these can be one of the fastest accumulating debts. Fortunately, credit card debt is considered an unsecured debt and these debts can be heavily negotiated if done correctly. Creditors rather see some money than none at all and they are willing to settle debts at drastically lower rates. According to Bradford Law Offices, PLLC, you can minimize the debts you have left by paying off large portions of it all at once. Credit companies struggle with debtors making payments all the time, and it costs them significantly to be constantly pushing out late notices and harassing people. These companies want to settle for one large lump sum payment that can amount to 30-50% less than the original total, rather than to see a individual consistently failing to make payments. Debt negotiation can be a useful tool when done right; however, these creditors typically do not have your best interests in mind but they are willing to settle for whatever they can get.