- 1). Stop paying all your credit cards debts that you want to settle.
- 2). Create a corporation to open a corporate bank account or have a bank account opened but not in your name.
- 3). Deposit 50 percent of the current payment of the debts into that account monthly.
- 4). Advise creditors who contact you that you are facing financial hardship and considering bankruptcy. They will then make a settlement offer. State that you could pay 10 percent of the total amount. The companies will reply they can only do 50 percent but will see what they can do.
- 5). Do not take their first offer. Wait a month or two more and when they call again, ask if they can do 10 percent because you can pay the entire amount upfront. They may, in turn, settle with you for 10 to 30 percent but you will need to pay in one or two lump sum payments. The monthly payments you made to your corporate account should be enough to cover the lump sum.
- 6). Accept their first offer only if you are afraid of getting sued and prefer to settle fast. In that case, they will offer 40 to 50 percent, which you can accept if you have sufficient funds in your corporate account.
- 7). Do not accept a settlement less than 20 percent, if you prefer to fight. Thus, you can fight any lawsuit, filing an answer that your creditors have no proof of the debt and you never signed the credit line. They have to prove the debt and that you authorized it. Often, they will lack such evidence.
- 8). Settle for 40 percent if the company indeed has the documents. However, a good chance exists that they do not have your signature; thus, the case and the debt could be dismissed.