How Come Debt Settlement Services Have Such Different Program Terms?
Amongst the many things you need to be leery about when signing up with debt a settlement service, one of the largest problems, is the actual program term. Since the program term will determine, not only the total amount you end up paying, but it also will determine your monthly payment.
Some companies will stretch their monthly term to 48 or 60 months, we have even heard of a company that offers an 80 month term.
You have to be careful with those types of companies. Since programs like that will most-likely get the client sued by the creditor, and they are most likely a scam debt settlement service. The company plans on the client being sued and take their fees from you long before it happens.
A debt settlement or debt negotiation program should not be over 36 months. And if you have under $70,000 in debt your program term should much shorter.
Since the faster the creditor gets paid, the less negatives can happen against you. First negative being, less late payments on your credit report and second being, less chance of being sued by your creditor.
Can you be sued? Yes, and don’t let any company tell you otherwise.
Is it likely you will be sued for a judgment and income garnishments? It will all depend on your situation, and whether it is “cost efficient” for the creditor.
So if your term is short like 12 to 30 months, your minimizing the risk, by paying them back faster. Plus it gets you out of debt faster too!!
The best way to go, is a term under 36 months with “No Pre-Payment Penalty” then you are in control of the term and you can pay more when you can afford to and the minimum payment other months. This way you are still assured the program in done in under 3 years but it could be much faster depending on your settlement amount and how much you pay each month.
By: Jeff T Forman
Tags: 3 Years, Credit Report, Creditor, Debt Negotiation Program, Debt Settlement, Judgment, Late Payments, Many Things, Minimum Payment, Risk, Settlement Service, Settlement Services