Debt Settlement Programs
Debt Settlement is process and approach to becoming free of unsecured debts. The goal of a debt settlement program is to find the best solution to lower your debts, help you deal with your creditors, and get you on the road to financial freedom. If you have a serious amount of debt and/or are considering credit counseling or bankruptcy this is a program you may want to consider.
Typical settlements are able to reduce debts by up to 30%-50%*. As an example, an account with a $20,000 balance may be able to be negotiated down to $10,000, or lower. Negotiations depend on a lot of factors so you need to work with a reputable debt relief company to discuss your options. You will pay a fee to the company to negotiate the settlement, but typically the settlement plus fees is less significantly than the original amount of debt owed.
A debt settlement program can help you be free of unsecured debts in as little as 2-3 years for a fraction of your original owed amount.* Even better than simply saving money is that once the settlement payment is made, your accounts will be satisfied - meaning you no longer have any of your original debt outstanding.
Debt Reduction Steps
A Debt Reduction Program can be very effective if you follow the program you set up with your counselor, and the information you give is accurate.
Here is a step-by-step overview:
Step 1: Call or e-mail Green Light Debt Relief for a free consultation. A professional consultant will assess your financial situation to determine your potential for debt reduction. Make sure to have all your statements and accurate information so that the consultant has the full picture of your situation.
Step 2: The most important part of this process is to work together to determine the monthly dollar amount that you can realistically save towards a negotiated settlement. The amount is typically less than your current minimum payments but needs to be an amount you can afford each month. This money will be put aside in a new account you set up and control to go toward paying off your debt (not simply paying credit card interest charges).
Step 3: After you enroll in a Debt Settlement Program, your creditors will be contacted in an attempt to handle future creditor communications. It is advised that you avoid using credit while on the program.
Step 4: After you have saved enough money in your account to make a reasonable offer, individual negotiating begins with your creditors. When dealing with the creditors, we typically attempt to reduce debts by at least 50% of your current balances. Please be aware that it may take several months of savings before we are in a position to make settlement offers. We stay in contact with you to keep you apprised of your situation but you may still be contacted by creditors during this process.
Step 5: Once we have secured a settlement with a creditor, we will notify you via email and/or a phone call to explain what has been negotiated. You will then need to follow the instructions to pay the settlement as per the agreement.
Step 6: Once an account has been paid the creditor will make a report to the credit bureaus. This may take a few weeks to a few months depending on the company. On your credit report you may see that your account is "settled in full," "settled," "paid," "paid by settlement", or "settled for less than the full amount." No matter how they report it, you no longer owe on this account and the balance is zero. You are now free of that debt. Green Light Debt Relief cannot give any advice or guarantees on your credit rating or availability of future credit **
After the Program: To avoid getting into this situation again, it is advised that you seek out financial planning and/or budgeting workshops. Many local community colleges or cities have free or low cost programs to help you create a plan for your financial situation.
* Estimates based on prior results; individual results will vary based on circumstances, including your ability to save sufficient funds and complete the program. We do not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. We do not assume consumer debt, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Not available in Colorado, West Virginia and Wisconsin. Please contact a tax professional to discuss tax consequences of settlement. Read and understand all program materials prior to enrollment.
**Please note, Greenlight Debt Relief is not a credit repair organization