The Law Office of Lauren S. Cohen, LLC
Over 35 Years Of Experience At Your Side
Phone: 607-821-0100
Toll Free: 866-539-2596
Our Practice Areas

Pros and cons of debt settlement

Some New York consumers who are struggling with credit card debt might be considering a debt settlement arrangement. There are advantages and disadvantages to this as a solution.

Debt settlement sums usually are around 50 to 80 percent of the total balance that a person owes. People who do go the debt settlement route can negotiate the settlement themselves with the issuer or can hire a lawyer to do so. They should also get a copy of the settlement offer in writing. There are debt settlement companies that can assist with negotiations, but not all of them are entirely honest. Pitfalls people should watch out for are companies that insist that their services are needed to negotiate a debt settlement, those that tell the customer to stop communicating with the credit card company entirely and those that demand a payment in advance. Debt settlement companies also cannot guarantee an outcome such as no more contact from the credit card company.

There are additional disadvantages to debt a settlement. There may be taxes on the amount that is forgiven. There may also be high fees, and a settlement could worsen a person's credit. There may be other alternatives including a debt management program, a hardship program, working with a credit counselor and declaring bankruptcy.

Some people may be reluctant to file for bankruptcy because they fear doing so is irresponsible or will destroy their credit over the long term, but neither of these is true. Bankruptcy can be a responsible way for people to get finances back on track, and credit can be rebuilt after a bankruptcy. Filing for bankruptcy puts an immediate stop to any creditor actions. Bankruptcy can provide a fresh start for those who are struggling with debt.

No Comments

Leave a comment
Comment Information
Email Us For A Response

Let's Work Together To Resolve Your Legal Issues. Contact Me Today.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Contact Information

The Law Office of Lauren S. Cohen, LLC

Johnson City Office
520 Columbia Drive, Suite 102
Johnson City, NY 13790

Toll Free: 866-539-2596
Phone: 607-821-0100
Johnson City Law Office Map

Binghamton Office
49 Court St
Binghamton, NY 13901

Toll Free: 866-539-2596
Phone: 607-821-0100
Map & Directions

Johnson City Office
Mailing Address
828 Oakdale Road
Johnson City, NY 13790

Map & Directions