Too much of credit card debts can turn out to be the reason behind your sleepless nights. Though they're easy to incur, the enhanced interest rates make them much harder to get rid of. If you feel overburdened with the growing pile of your credit dues and want to get rid of them legally, you can choose credit card settlement to do away with them altogether.
Financial crisis starts when your credit card bills turn into unmanageable debts. Find out when you would need assistance to regain control over unmanageable credit card debts and can decide to settle them.
The settlement process involves negotiation with your creditors to reduce your total outstanding credit card balance. It's often regarded as the best way for a credit card debt payoff – chiefly, due to the considerable reduction it offers. The late fees or penalties charged on the debts can also be eliminated with this relief option. You can pick a professional company to represent you as they usually negotiate better with creditors and even offer legal assistance when required. You may also benefit from reduced collection calls and be able to avoid bankruptcy by settling credit card debts.
Negotiating credit card debts during settlement usually brings a significant reduction in the debt amount. However, the IRS considers the forgiven amount as your income, if it exceeds $600. Consequently, the creditor or collector is supposed to send you IRS 1099-C Form, and you'll be liable to pay income tax on the forgiven amount. If your debts are more than the value of your assets, you can file IRS form 982 to have the benefit of exemptions.
The missed or irregular payments on credit card debts usually take its toll on the consumer's credit score, even before he chooses to settle the bills. Moreover, since you'll be paying less than the owed amount when you settle credit card debts, your credit score will evidently take a hit. After settling your dues, your account status in the credit reports will be updated as "Paid as Settled" or "Paid as Agreed", which will be affecting your score. However, if the creditor agrees to a 'Pay for Delete' agreement, the negative information can be removed from your report.
Eliminating credit card debts would not seem that difficult if you get professional assistance along the way. Our attorneys and relationship managers can help you with your numerous credit card bills and make sure that you pay them off steadily.
Check out the 6 steps through which OVLG processes your credit card debts.
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