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Consumers may consider debt settlement plan
11/11/2009
Debt settlement is one way that consumers may be able to find some help when it comes to money management.
A consumer credit counceling agency can refer a consumer to a debt settlement company, which in turn can negotiate with lenders in order to reduce the amount a consumer owes on things like credit card debt. In a recent story for articlesbase.com, Vincent Polisi, founder of the rent-to-own firm Finance the Dream, noted that creditors would rather get some of the money they are owed rather than none at all.
"With debt settlement, you will be negotiating with creditors for them to reduce the balance somewhere between 40 percent and 60 percent of what you owe," Polisi wrote.
Another option that a consumer credit counseling agency can offer is a debt management plan, in which the firm negotiates to reduce interest rates. Unlike a debt settlement plan, debt management has the consumer eventually paying the entire amount they owe.
Finally, one of the other options offered by credit counseling includes setting up a plan for personal budgeting. There are a number of things people can do in order to trim the fat from a budget, including cutting down entertainment spending and buying generic goods.
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