What is a debt settlement attorney?
Debt settlement attorneys are lawyers which specialize in credit negotiation to help you reduce the amount of your debts and help you start a new debt free life. These lawyers are the ones who deal with each of the companies you owe money to and help negotiate with them to stop penalties, late fees and other amounts that are building up on all of your debt accounts. The attorney for debt settlement could help you obtain a single low amount that you could pay, reduce your payment due and clear your credit report of any misleading, unsubstantiated, incorrect or wrong items. It is very important that if you hire a debt settlement attorney that you ask him to do this for you because it could help you greatly improve your credit score and restore your credit status for your future financial needs.
Attorney based debt settlement may sound easy because you are hiring someone to fix your mess for you. However, what most people realize is that it is very costly. Most debt settlement attorneys do not work pro-bono or for cheap. Since it is a more aggressive approach than normal debt consolidation and counseling, and it is more personalized, it comes with a very high price tag.
What most people do not realize is that there is a law that states that if you ignore your debt for some period of time, the creditor will not bother you again and seven years later, the debt is written off and it disappears from your record altogether. However, if you pay the debt before the period ends, the cycle restarts and it could affect your credit status negatively.
However, creditors would always want to get paid. Therefore, they could bargain with you not to write bad reports about you in your credit report if you pay up. They are usually willing to help you regain your good credit status if you show that you are a willing payor.
Most debt settlement attorneys deal with unsecured debts such as medical bills, credit cards, and department store credit. They do not deal with mortgages and other things which are secured by a collateral.