Debt is by no means something rare, especially in the current global situation, but there are ways to overcome it, without having to resort to filing for bankruptcy.
New legislation has been approved that gives funds and solutions for those in need of financial support so that the country will not find itself knee deep in debt with no hope of recovery.
A reason why creditors are willing to settle with their customers is that they too are companies, and as such they want to stay in business.
Having a lot of customers who are not able to pay even a fraction of their debt will mean almost certain bankruptcy and that is something very much undesirable.
As a result, when a customer tells his credit card company that he is no longer able to pay all of his debt, a settlement is made, allowing him to only pay part of his debt.
This way, the company is at least able to stay in business, leaving profit for a more favorable time.
Debt settlement is very advantageous for a debtor, as it can reduce fifty percent of his debt by simply negotiating with his creditor.
This huge reduction comes mainly from accumulated interest, but also includes fees, penalties and other hidden costs.
Upon completing the negotiation process, the average customer will be able to eliminate all of his debt within three or four years, depending on how his income evolves over time.
The effect this method has on your credit score is negligible - yes, it will go down initially, but simply paying your installments on time will contribute to its rise, so in the end you will probably have much the same score.
All in all, debt settlement has none of the disadvantages of bankruptcy, but it allows you to recover form your debt quite easily in just a few short years.
And with the newly established laws that favor the customers, you can be sure that you will stay debt free for a long time to come, with only a bit of discipline.