As a result of drastic changes in the economy over the past few years, has developed a cottage industry that is dedicated to providing consumers with the debtors, "the gospel" about how to get out of debt. However, while there are many give advice on debt reduction votes, the teacher of the spiritual movement of debt reduction is Dave Ramsey. I am a listener and Ramzi fan. To some extent, I insisted on his philosophy debt reduction. However, unlike Ramsey, I am an attorney who specializes in easing the burden of consumer debt. While Dave Ramsey provides useful information and good common sense advice on debt reduction, there is a lot he does not tell you to get out of debt.
summed up the symbolic approach to the debt solution as follows:
1. Start small cash contingency fund.
2. pay off the smallest debt first large debt latter using symbolic that the "debt snowball" technique.
3. reserves constructive criticism with the funds that are used because the pay toward the debt.
While this is a valid method of debt settlement, it is likely to lead to pay much more money than is necessary to resolve the debt. Most debtors using this technique will end up paying 100% plus interest on the debt, which would like to settle. And take advantage of consumer debt specialist services result in more effective and affordable strategy away from the solution and the settlement of consumer debt. On behalf of my clients, I rarely settle any unsecured debt of more than 50% of the balance. In fact, the elimination of many of the debt completely with any payments to the creditor.
when I am contacted by the debtor for information on how to solve the debt crisis, there is never a "one size fits all" explanation. It is important to know the identity of the creditor, whether he had been assigned the debt to a third party, and the amount of dollars of debt, and the type of debt, a law firm or collection agency to deal with the account, place the debtor's residence and overall financial position of the debtor. These factors determine the difficulty that the creditor will face in trying to get the government and to what extent will try to get the verdict. If there was a difficult issue in the litigation, or the creditor is not very aggressive in the litigation, and owes more leverage in settlement negotiations.
There are two main types of creditors. Creditors and buyers original debt. Original creditors are banks and companies with whom you originally contracted. Debt traders from companies that buy the collection to reduce significantly the price calculations, in order to achieve profit through a combination of debt. Overall, the debt can be settled with the debt buyers for far less than you would pay to the original creditor. One reason for this is that the original creditor is trying to recover the money borrowed as principal plus interest that make their profits. The buyer of debt on the other hand, usually makes investment of no more than 2% to 5% of the nominal value of the debt.
Therefore, it takes less money to buyers of debt to lock in profits. Identity of the creditor is also important in the pre-litigation stage in order to assess whether the creditor is likely to sell debt or retained and debt collection at home. Many buyers religion often employ practices that run afoul of the debt collection practices law and generally show a lack of documentation to support their claims. There is a counter in a suit buyer religion often leads to the expulsion of religion. The original creditors employ various settlement policies and guidelines. This information, if it was not known to the debtor, will pay more money than necessary. From the perspective of a lawyer, the main concern is the possibility to defend the city against a lawsuit to collect successfully. The stronger the likelihood that the debtor can win a lawsuit seeking a judgment on religion, the more influence they will have in the settlement negotiations.
Although we win the overwhelming majority of the lawsuits we handle consumer credit, and some are difficult to win with more than others. For example, lawsuits involving credit card debt, and approve foreclosure and repossessions cars are much easier to win from medical debt and entitlements of cases Association at home. Knowledge of the type of case will help in assessing the value of the creditor's claim and to determine how much they should be offered as settlement. The amount of debt can also affect the possibility of settlement. While it seems to be common sense that the greater the debt, the more you have to pay, and this is not always the case.
For example, I recently received a call from a representative of the AMEX indicating that the new policy has been in place for a limited period to allow credit card accounts with more than $ 25,000.00 balances, which were in litigation, a solution for 20% of the the nominal value of the debt. However, represented in litigation with balances of $ 15,000.00 or less can be settled only on 50% of the nominal value of the debt. In the framework of this policy, and religion largest settlement for less than the largest debts. However, only available on debtors who hired a lawyer to fight the case this option. Where the debtor is involved in litigation debt, it pays to know the law and the judge you are experiencing. Many companies gather to deal with each case on the same road. Know their tactics helps to exploit their weaknesses. Know the judge's attitude toward the collection and knowledge of important civil procedure in determining how best to defend the case of the debtor also issues. Finally, the province where the debtor would be located where the suit. This information will assist in the evaluation of the length of time it will take the case to get to trial and having traveled by witnesses creditor to the court when engaging in settlement negotiations. Creditors of state rarely produce the witness for trial.
Another drawback in a symbolic approach is that it does not recognize the legitimacy of bankruptcy as a strategy to settle the debt. While we are benefiting from bankruptcy only as a last resort, for some people, bankruptcy is the best way to the resolution of debt. Anyone who really seeks to help someone facing a debt crisis and frankly assess the financial situation of the whole of the debtor to determine whether a debtor can and must file bankruptcy in order to escape from financial collapse. Anyone should be advised of the risk of financial well-being of their families in order to make interest payments to the bank or credit card company.
orientation is debt settlement is very different of symbolic approach can be summarized as follows:
1.) stop paying unsecured creditors immediately.
2.) debt disputes in writing and the search for validation and verification of the account and the amount.
3.) Do not talk with your creditors on the phone.
4.) Save all the money you can afford to use at a later time to settle those debts that can not be defeated through litigation accounts.
5.) If you sued by an unsecured creditor, hire an attorney who specializes in consumer debt to defend you.
6.) settle claims only those that offer substantial discounts and those that can not defeat.
7.) If you have no assets and no ability to save money, and to determine whether you are eligible to Chapter 7 bankruptcy.
greatest weakness in a symbolic approach to debt settlement is that it does not recognize the fighting collection efforts and debt reduction as a valid debt settlement. To pay the debt, which is the only option offered. Although it is counter-intuitive, he refused to pay this makes creditor willing to negotiate. As long as you think you owe a creditor asking for every penny, and will continue to ask for more money. Once you accept that debt settlement is the process of negotiation and not a moral obligation on your part, and will become more effective in freeing yourself from debt.
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