What you need to know about debt settlement firms:

Your credit card companies are not going to offer you settlements like 50%, for example, if you are current (not behind) on your payments. If credit card companies offered settlements to people who are current on their payments, then everyone would be calling them up and asking for 50% settlements. Basically, the only way you can get into a position to negotiate settlements is to deliberately let your accounts go into default. This is exactly what debt settlement firms do….They take a monthly amount from you and use that to build a “settlement” account, which will go towards paying the “settlement” at a later date. Your creditors will deliberately not be paid by the debt settlement firm during this time and the creditors will be VERY unhappy about this. The $270 payments for 36 months will be going directly to the debt settlement firm to build your settlement account and for their fees. Your creditors will not be paid during this time.

If you are current on your accounts, this process will ruin your credit rating as your accounts will all go into default. Your creditors are under no obligation whatsoever to accept settlements from any debt settlement firm you hire. Their response might be to serve you papers and take you to court.

Debt settlement can be a stressful and unpredictable process….As your accounts all go into default…you will get increasingly aggressive collection calls from debt collectors. It is "typical" that creditors offer settlements for defaulted credit card debt….They often do this in lieu of loosing everything if you file for BK…..

HOWEVER, you can never predict how any one creditor will respond to defaulted debt. They might decide to take you to court and get a judgment against you. Debt settlement firms have no power whatsoever to stop creditors from taking this action and they have no power to force creditors to accept settlements.
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Have you already defaulted on your card/has it been charged-off as bad debt? If the answer is no, then the deal they offered is probably a good deal given the state of the economy. Be sure to get a written agreement from them about these terms if you accept this deal. Creditors will later deny that any agreement was made if you don't have a written agreement to fall back on.self help may B best. what u must remember is that crediotors want $$$ on THEIR terms. sadly, if yer having $$$ trouble, this is impossible b/c u may run outta $$$ trying 2 pay on their terms leaving U w/ NOTHING 4 the mo, ALL mo, EVERY mo. this caused me trouble 2 the point I was off line a while b/c the $$$ was just not there. finally, I decided it was time 2 cut-off ALL my creditors til i was back on my feet again. by law, yer own needs come 1'st, which means u MUST learn how 2 say NO when needed & STICK 2 it. yes, fees will mound, & yer accts may end up in collections, BUT what's MORE important; paying down these debts, OR yer providing 4 yer family??? i'd hope u'd all c that immedi8 household needs come 1'st by law. this puts creditors @ low priority when u have no savings. 1 day we're all gonna B old & NEED $$$. this is y we MUST prepare NOW by paying ourselves B4 any1/thing.Poppy cock with creditsolutions, Do you really think you credit card company will say that's all right "you only have to pay half us half what you owe" If you believe that you must be smoking the wrong stuff. Many companies like creditsolution's have led people on; taking their money and leaving them high and dry. Even if everything that they were promising was correct, you would owe income taxes on $7500 and you would still show that $7500 of the debt was settled and entered on your credit report. Check with your better business bureau and your state's attorney general to see if they have any complaints about Credit Solutions. Take the bank's offer because it will reflect possitively on your credit report.

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