Are you a Hawaii resident, stressed with uncountable debts? Are you struggling to make both ends meet?
If that is the case, then opting for a debt settlement option in Hawaii can be beneficial.
In Hawaii you can settle your debts either by directly negotiating with the creditors or by enrolling with a reputable debt settlement company/firm.
The settlement process will not be very difficult if you know how to go about it. You just have to follow some basic guidelines to get it done effectively:
If the debt settlement process seems a little difficult, consider doing it with a Better Business Bureau accredited Debt Settlement Company in your state.
The company/firm appoints a debt settlement attorney who analyzes your situation and suggests plans that are suitable for your financial condition. The attorney also negotiates with your creditors to reduce your debt principal and interest rates. A successful debt settlement can get your debts settled for 40-60% of what you owe.
The attorney also creates a repayment plan for you if you are unable to offer a larger sum as the settlement amount. Most important of it all, you are saved from the creditor harassment calls and threats. Your lawyer sends each of your creditors legal notices to prohibit any kind of harassing activities by creditors.
The duration of debt settlement in Hawaii depends upon a variety of factors like your outstanding debt amount, the kind of debts, and the number of debts that needs to be settled.
In Hawaii a credit card debt settlement case requires 3-9 months whereas in case of other kinds of debts the time limit is normally 1-3 years.
The effect of debt settlement on credit score depends upon two major factors; your credit score and the extent of delinquency of your accounts. When you enroll for a debt settlement program your credit report is already poor. After you start making regular monthly payments, your credit score receives an immediate hike.
If you settle your delinquent accounts, it boosts your credit score more than if you settle current accounts. If you settle current accounts, your credit score goes down temporarily. But with time, your accounts are settled, and your credit score improves.
Below are some of the benefits of debt settlement in Hawaii:
The IRS deems any amount forgiven under a debt settlement program as income, and requires you to report it on your income taxes for the year the debt was forgiven.
If you qualify as insolvent on the day before your debt was forgiven, you will not have to pay taxes on the forgiven amount.