Debt Settlement Attorney
A debt settlement attorney will act on your behalf to reduce your debts by arbitrating or negotiating with your creditors.
Each year, millions of people get so behind in their bills that they contemplate filing for bankruptcy in order to give themselves a fresh start at getting their financial affairs in order. Bankruptcy, however, is a drastic step.
Many times, you can work with a debt settlement attorney to reduce your debts enough so that you can avoid having to go the foreclosure route. If debt settlement turns out to be unfeasible, you still have the option of filing for bankruptcy at a later date. When talking with a debt settlement attorney, many creditors have an incentive to to accept a deal in order to at least recover a portion of the debt that they might never see if the debtor did decide to file bankruptcy.
Tips to Hiring a Debt Settlement Attorney
When choosing a debt settlement attorney, it is best to choose a specialist, one who specializes in debt relief strategies and negotiations. More than likely they already have a number of contacts and relationships at various creditor offices that they can call upon. They also have more expertise and can give you realistic expectations of possible outcomes, much more accurately than a general attorney or one who specializes in other areas.
The Good and Bad of Hiring a Debt Settlement Lawyer
There are both benefits and drawbacks to hiring a debt settlement attorney. The benefits are that you will no longer have to deal directly with your creditors. Your attorney represents you and does all of the negotiation on your behalf.
In addition, when it comes to discussing debt settlements, some creditors prefer to dealing with attorneys than with the debtor. And, lastly, a good debt settlement attorney will know what to do in order to make sure that as many of the negative things as possible are removed from your credit report once the debt is paid.
The biggest drawback to hiring a debt settlement attorney is that it will not automatically prevent creditors from filing lawsuits against you. For example, nearly all settlements are lump sum settlements. This means that unless you have a stash of cash to pay your settlement with, you will have to pay installments to your debt settlement attorney.
When he believes the sum is enough to make an offer that the creditor will accept, he will contact the creditor. In other words, during that time when you are paying monthly installments, you are still at risk for being sued.
Debt Settlement and Fees
Some attorneys charge a flat fee for their services. Most, however, work on a percentage basis. Some will also offer you a refund if they are unable to negotiate lower settlements.
Before you hire a debt settlement attorney, a good course of action would be to first seek the advice of a good bankruptcy attorney that you trust. He can look at your particular financial situation and give you advice on whether it is best for you to file bankruptcy or to seek a debt settlement with your creditors.
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