A Debt settlement program can be understood as a debt negotiation or debt arbitration activity in which your “representative” mediates on your behalf with your creditor or lender, to seek “waivers” or “elimination” of your total outstanding amount, and reduce it significantly so you end up paying less than the actual amount. Generally during the negotiation activity, the creditors agree to accept a portion of what you owe (usually around 50% or less) and concede the remaining amount.
The fundamental idea of debt settlement is to settle your account by letting your creditors forgive some portion of the remaining outstanding balance. Debt settlement program is also a confirmed way of coming out of your debts, and protect you from chapters 7 and 13 of the Bankruptcy Act. In reality settlement programs can aid you by reducing your debts by as much as 30-40% or even more depending upon your negotiation capabilities.
Credit card settlement can also be carried out in a reciprocal manner. In case of credit card debt settlement, debt settlement services specially cater to negotiations on behalf of the individual owning the card, and mediate on his or her behalf to write of some portion of the outstanding amount with the creditors or credit card companies.
