Thankfully, there are now several web sites that are there to help people like you with bad credit to find the fast personal loans that you need. When you have bad credit, the first thing that you should be looking for is a loan company that If your financial problems have reached the point where you do not see a way out and you feel as though you are drowning in debt, your best way out is through declaring bankruptcy. Filing may well allow you to get your finances back on track
Debt settlement is a debt relief option that involves working with your creditors to renegotiate the terms of your loans or to settle – or forgive – a portion of your debt. It can be a feasible debt relief option for some consumers, but there are certain factors to consider before you pursue it. Keep in mind that there is no ideal solution: There are always drawbacks and consequences, as well as certain hurdles to clear. Not to mention, debt settlement will impact your credit score, so make sure you are absolutely certain this is the right option for you before you explore it further. Here, we will discuss some of the key considerations you should examine before pursuing debt settlement as a debt relief option.
- Are you current on your payments? If you’ve already fallen several months behind on your payments, this may not be the best option for you. Your creditors are much more likely to work with you and offer flexibility if you’ve reached out to them before falling delinquent. Not to mention, staying current on your payments means that your creditors haven’t already started to reach out to you or referred your account to collections, which gives you a much better chance of successfully negotiating with them.
- Do you have an open line of communication with your creditors? Your creditors will be far more likely to help you if you communicate openly with them before you default on any payments. This will give you credibility and signal to them that you’re willing to pay them – you just might need some flexibility on either due dates, repayment scheduling, or even the total amount owed. If you don’t have an open line of communication or the prospect of negotiating with your creditors is too stressful, consider engaging a reputable debt relief company to represent you and to communicate with them on your behalf.
- Are you having ongoing cash flow issues? Debt settlement is a fantastic option for either individuals or businesses with some revenue and ability to repay, but who are experiencing cash flow issues that prevent them from making payments in a timely manner. By adjusting your due dates or extending your repayment schedule to lower your monthly payment amounts, you can address many of your cash flow issues while still paying your creditors.
- Are you prepared for the tax liability associated with any forgiven amounts? This applies if your creditors forgive a portion of your debt. The IRS considers forgiven debts taxable income, so you will need to report it and pay taxes on it. If your creditors forgive a large portion of your debt, keep in mind that this also means you will owe a lump sum to the government, so make sure that you either have the cash – or a plan – to do so.