Hiring A Lawyer Might Be A Good Idea For Settling Debts

Hiring A Lawyer Might Be A Good Idea For Settling Debts

As per the law, you are allowed to settle your debts if you find that it is hard to pay it off at the current rate considering your current financial conditions. The law also permits you to go for it by yourself or hire professional services from a debt settlement company. You may also hire a qualified debt settlement attorney for that matter. A debt settlement company as well as a debt settlement lawyer will charge service fees from you.

Which one to choose

If you are struggling with your debt and finding it difficult to pay every month and falling behind your repayment schedule then it is time for some serious thinking so that you do not damage your credit even further. It is time to face your creditors and negotiate for a better term.

If you cannot negotiate with your creditors no your own you will need help from a professional for this. You have two available options at your disposal: one is to hire a debt settlement attorney and the other is to hire a debt settlement company.

It highly recommended hiring an attorney instead if a debt settlement company for several good reasons of its own. However, it is also advised that you research properly before hiring an attorney and always hire a reliable and reputable law firm for best help and service. Make sure that the law firm is legitimate as often a debt settlement company can masquerade as a debt settlement law firm.

Process of work

When you want to make the right choice between a debt settlement lawyer and a debt settlement company, you must first know about the working process of each, the nuances involved and the outfalls to avoid.

  • Usually the debt settlement companies will often claim that they negotiate the best deal from your creditors. Few will even say that they will reduce your unsecured debts loan amount to pennies instead of dollars.
  • They might also tell you that the creditors will not negotiate until you stop making payments if you are current with it.
  • There may be a few that will ask you to make these payments to them instead of your creditors for the time they negotiate with your creditors.

All these things are not permissible as per the law. The law also does not allow any debt settlement company to charge you until an unless the service that promise to offer is completed or a major portion of it is completed and you have started making payments according to the newly negotiated terms. Still, there may be few that will charge you their fees that will include:

  • A monthly fee for their service
  • Your savings that may be set aside for settlement of your debts in the future
  • Also a contingency fee which is a percentage of the amount you save through the settlement and
  • Setup and other fees.

However, the debt settlement company will not tell you a lot of things which is why you are requested to choose a company after reading the debt settlement reviews and the success rate.

The debt settlement company may not mention that:

  • The total amount due will increase once you stop making your payments due to different fees and interest charges added
  • Your creditors do not have any obligation as per the law to accept a reduced amount than they actually owe
  • Many creditors do not accept any settlement initiated by a professional
  • They still have the legal right to sue you for stopping your payments and
  • There are several risks in debt settlement especially damaging your credit score.

The reason that these debt settlement companies act in such unscrupulous manner is that they are primarily a for-profit company. They are not much bothered about your situation but or want to help you out. They are more concerned about their own benefits and make fast bucks. In almost all situations, you will be much better off paying down your own debt than pay it to a debt settlement company.

Hiring a lawyer

Hiring a skilled attorney is always a better idea if you really need any professional help. They will act within the peripheries of the law and will be well versed with the laws of money lending and collections. They will know the limitations of the law and act accordingly and most importantly they will work for the best of your interest.

  • With their wide and extensive legal knowledge about this field and years of experience, they will be able to provide you with more practical legal advice and help you to take the most sensible approach to get rid of your debt. They will not make any false promises and give you the best opinion after fully analyzing your financial and debt situation.
  • Most importantly, you will have the added benefit of them representing you in the court if your creditor has filed a lawsuit already. As legal matters are complex and have a lot of requirements, rules and regulations to follow, a skilled legal worker supporting you will provide you with the best chance of winning. A debt settlement company will not be able to do all these things.
  • The attorney will consider the legal aspects of every debt relief option available to you and will go over all these options with you. You will be offered the best legal guidance whether you opt for a debt settlement or for filing a bankruptcy as suggested by the skilled attorney. If you hire a debt settlement company they will always try to convince you for debt settlement only for their benefits.
  • Moreover, if the creditor violates the law as set by the Fair Debt Collection Practices Act the attorney can provide proper advice and tell you how to proceed in such situation which a debt settlement company will hardly be able to do.

In most cases the attorney will deal with your creditors directly for negotiating. The most important fact is that most attorneys will work upholding strict ethical standards.