They are really just different terms for the same thing. Whether it’s called debt settlement, debt resolution, debt reduction, debt negotiation, debt arbitration or debt management, we’re really talking about a non-bankruptcy means of dealing with your debt. Debt settlement (and these other terms) refers to working with your creditors to reduce the amount that they are willing to accept to eliminate your debts with them—usually about 50% of what you owe them.
The nice thing about debt settlement is that you work privately with your debt settlement provider. Your budget, your income and other financial details are never opened to the public. Whereas the opposite is true in a bankruptcy filing—all of the details of your financial life are laid bare for the public to see. Another benefit of debt negotiation is that you are reaching a compromise with your creditors to pay something back. This probably feels better to most than filing a bankruptcy and not repaying your creditors at all. In this way, debt settlement is a nice credit card debt elimination plan.
Another reason you might look at a debt settlement plan is if you do not qualify for Chapter 7 bankruptcy. In order to qualify for Chapter 7, you must have income below the median income for your state for your household size. Also, you must have assets that fit within your state’s bankruptcy exemptions. If you have some land in the mountains that has no mortgage on it, for example, you may not want to file a chapter 7 because that land would likely be sold to pay creditors. Any good debt relief plan will be built only after knowing all of your options and the pros and cons of each. You should consider consulting a bankruptcy attorney to make sure you have been advised of all of your bankruptcy options. With Trident Debt Solutions, you will meet with attorney Steve Craig and he will advise you of all of your bankruptcy options as well as debt settlement.