Debt settlement is one of the best options to consider when you have lump sum debts. It is one of the alternatives that help you to get rid of your debts fast.
If you are a resident of Kentucky looking for a way out of your overwhelming debts, debt settlement can be a great option!
The process helps in reducing your monthly bills along with the interest rates. With debt settlement you can bring your finances back on track and manage them better.
The debt settlement process in Kentucky is highly effective in resolving your lump sum debt. Here you make payments on your debts that are far less than what you originally owed. If you can negotiate well, you can reduce your debts up to 40-60%, thus saving a lot of money at end of the settlement process.
You can carry out debt settlement in two ways:1. Do it yourself:
You can carry out the settlement process yourself if you are able to handle the stress. You need to convince your creditors that you are unable to make even the minimum monthly payments. If they do not agree to a settlement, you need to inform them that your only other option is to file for bankruptcy.
Settling debts on you own is a great option, as it helps you save some money, which would have gone to the settlement company. You can easily settle your debts with your creditors if you following these basic guidelines:
As the process of debt settlement is quite complicated, it may be safer to hire a debt settlement company to sort out your debt issues.
The company first analyzes your financial condition and suggests an appropriate remedy. An expert debt settlement attorney is appointed by the company to negotiate your debts with your creditors.
A successful debt settlement program can reduce your total debt amount up to 40-60%. The lawyer will also get your interest rates. Your attorney will help you with repayment plans if you are unable to pay the lump sum payments. With repayment plans you can easily pay back your debts with affordable installments.
Settling debts with the help of a debt settlement company acts as an additional tool while handling creditors. The attorney notifies your creditors to stop all communication with you. As such, you can be safe from any creditor abuse and threats.
The duration of debt settlement process in Kentucky depends upon the kind of debt, outstanding debt amount, and the number of debts you intend to settle.
In case of credit card debt the duration varies from 3-9 months where other debts it is 1-3 years. But depending on the other factors the duration will vary.
Debt settlement programs in Kentucky aim at boosting your credit report at the end of the program. When you enroll in the program your credit scores are low, however after you make regular monthly payments under the program your scores automatically improve.
Results cannot be expected overnight. If you can increase the amount of your monthly payments you can pay back your debt earlier.
If you settle your delinquent debts credit score receives increases more than if you settle more recent accounts. As the delinquent debts get settled your accounts are marked as "paid off" which helps in improving your credit report.
Any amount forgiven under a debt settlement program is counted as income by the IRS. You are required 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 do not have to pay taxes on the forgiven amount.