Six Myths about Debt Settlement Debunked

There are many different myths when it comes to financial matters; debt settlement is no different. Some of these myths may be the very thing that is keeping you from contacting one of the reputable debt settlement companies in New York City. Here are a few things that you need to know so that you can make an informed decision regarding the next steps of your financial future.

Debt Settlement is the Same as Bankruptcy

This is definitely false. Bankruptcy requires that you file an application in your local court and there are several restrictions. Debt settlement in the simplest terms allows you to take your unsecured debt and make one affordable payment.

Debt Settlement will destroy Your Credit Score

Chances are your credit is already suffering because of the amount of debt that you have and the fact that you have not been making the payments as previously agreed. A debt settlement program will allow you to make one payment that will go toward paying down your debt, which of course helps your credit.

Debt Settlement Requires a Lawyer

Because you don’t have to go to court and file specific paperwork, you don’t need to hire a lawyer to use one of the debt settlement companies in New York City. This myth may come from the fact that many collectors have threatened legal action and the automatic thought is that you need legal counsel to stop those actions.

Debt Settlement is Only People with Money Management Issues

Going into debt is not always about poor money management. In fact, if you were not deemed credit worthy at some point, you would not have been extended credit in the first place. You may have credit card bills, medical bills, or you may have even experienced a loss of income. There are things that happen that are beyond your control. That doesn’t mean that you are irresponsible.

Debt Settlement Incurs More Debt

Debt settlement does not incur additional debt. The company may be able to settle some of your debt for a lesser amount. Therefore, this is completely false.

Each financial situation is different and there is no one size fits all solution. The best thing to do is enlist the assistance of a qualified professional.