Debt settlement, also known as credit settlement, debt arbitration, or debt negotiation – involves negotiating with your creditors to pay off your debt. The debt is usually negotiated to a reduced balance with that amount being considered as payment in full once paid. Simply put, you agree to pay just part of your unsecured debt, such as money owed for medical bills or a credit card company and your creditors consider your debt to be completely paid.
For this process to be successful, you must have experienced negotiation skills to deal with your your creditors. While many people choose to negotiate on their own, more often than not they do not have the skills and knowledge to get a favorable debt reduction. For this reason, it’s important to have a debt settlement attorney on your behalf, conducting the negotiations, and striving to get the balance reduced to a manageable amount that you really can afford to pay off. You can potentially save lots of money by having a debt settlement lawyer conducting the negotiations with your creditors.