Learn how a debt settlement attorney can advantage you much more than a debt settlement company!

This is going to be a rather long article in which I will review what the differences are between a debt settlement law firm and a debt settlement company. However assuming many people do not even know much about debt settlement itself I will first go over the process of debt settlement, then explain how various organizations such as law firms and companies handle this settlement process.

In recent years debt settlement has become a much more popular method for consumers to get debt relief. With the economy being in the condition it is most people simply cannot afford to continue paying out high minimum payments each month to credit cards with no end in sight. While there are many options available for debt relief, at the point of not being able to maintain minimum payments, many debtors find that Bankruptcy or Debt Settlement as their most viable options.

The goals of debt settlement are twofold, one to save the most amount of money possible for the debtor, and two to get out of debt as fast as possible. The process in and of it self is rather simple, you must fall behind on your payments meanwhile save money in a side account which will be used in the future to negotiate a one time lump sum payment to settle out the account at much lower than the current balance. This results in saving a lot of money on the debt and getting the debt paid off much faster than it would take to pay off debt through the creditors monthly minimum payment cycle dubbed by many as the “credit treadmill”

One thing that must be accepted if you are going to engage in debt settlement is that you will have to fall behind in order to get any sort of settlement, the creditors simply will not accept less money when they feel you have the money to stay on their credit treadmill, paying them thousands in interest each year.

Before addressing the advantage of retaining a law firm over a company you must understand the benefit of having someone handle the settlement process and not yourself. Many people think this is a simple process to complete and think they can do it by themselves and save some money. This is simply not the case.

You must understand many aspects to go about obtaining a settlement in the legal way and in a way which will save you the most amount of money. The paperwork must be handled properly with every T crossed and I dotted. You must know which people to get a hold of to even have the slightest chance of getting a decent settlement. You hire somebody to negotiate on your behalf, someone who is experienced at doing just that. So you do not waste your own time attempting something you may very well fail at and end up putting yourself back into an even bigger ditch.

There are differences between a debt settlement law firm vs debt settlement company and this will explain the major advantages of retaining a law firm.

Difference 1: How collections calls can be handled!

If you do not already know once you fall behind on and credit cards or other unsecured debts that you will be receiving calls by them attempting to collect the debt. This is one of the drawbacks to debt settlement. However these calls can be drastically reduced by retaining a debt settlement law firm

A debt settlement company does not have the legal power to stop calls whatsoever. Usually they will advise their clients to send a cease and desist letter to get calls stopped. In many cases this stirs a hornet’s nest and can prompt action against the debtor from the creditor.

A debt settlement law firm has the power to reduce collection calls, and upon signing up and paying a retainer will issue letters to inform the creditors they will be representing you for the purposes of negotiation your debt. Creditors take such action in a much different light; first of all they know the debtor has a lawyer behind them who knows how the law operates. Second they know that they will be getting money as some point! This is a huge difference that many people do not know about. If you wish to reduce calls then it is imperative to retain a law firm over a company

Difference 2: Legality and how law suits can be handled!

What many folks do not realize is that the vast majority of debt settlement companies are operating illegally! Most companies do not have the legal power to negotiate and settle debts around the entire country, in fact many companies do not even have the proper set up to negotiate debts in the state the operate in.

The FTC and other regulatory bodies have been cracking down on such companies and shutting them down. This leaves the debtors enrolled with these companies in very vulnerable positions. What happens when the FTC shuts down a company and demands the company refund all its fees to its clients and they don’t have the money? You simply do not get your money back and are left holding the bag not knowing what to do or have the money to do it.

This is happening all the time and is severely affecting people in a negative way. A debt settlement law firm however will be properly registered and have the legal power to negotiate your debts on your behalf, without fear of them getting shutdown.

Another issue that must be mentioned with debt settlement is the issue of law suits. When you do not pay a creditor they then can attempt to collect the debt by taking you to court and attempting to get a judgment. I must mention that this is no where near as common as some people think it is but it still is a possibility. The creditors simply do not have the money and time to take most accounts to court.

But if they do you want to make sure you have your bases covered, and with a debt settlement law firm you will. The law firm will legally be able to contact the creditor attempting to take you to court and negotiate an out of court settlement. This is huge in terms of security you want when going through debt settlement. And you must realize that a debt settlement company cannot do this for you, and will have you handle the case on your own, usually resulting in the client getting a judgment.

Difference 3: Prestige of a law firm over a company!

A creditor tends to treat an account differently when they know they must obey all the laws governing them, and a law firm is going to be familiar with the laws in your state , which will definitely give the debtor a major advantage.

Taking all of the above points into consideration it is apparently much more advantageous for someone stuck in credit card debt or other unsecured debts to retain a law firm for debt settlement then hire a company or attempt the process on their own.

If you would like more information about seeing whether a debt settlement law firm can help you get out of debt then click here.