Once you have decided to opt for settlement the main thing is to decide whether you want to undertake the settlement procedure yourself or hire the services of a settlement company.
Although you can settle the loans yourself, it is advisable to hire a settlement company because, a professional company will know all that is needed about settlement laws and the rights of debtors.
There is less chance of you getting a shoddy settlement deal.
At the same time you will saved the stress of having to deal with several creditors all trying to get the better of you.
However there are some things you need to consider before you hire a settlement company.
Usually all good settlement companies provide you with counseling sessions in which they advise you about the plan they are going to follow when negotiating the debts.
During such sessions with the companies you have enlisted you should check whether your company is actually going to help reduce the burden of your debt.
Many companies would offer ideas like consolidation and conversion of loans.
Although these procedures have their own merits they only give you the benefit of reduced interest rates.
The principal amount remains the same.
In a settlement however the principal amount itself is reduced.
A settlement company will approach creditors on your behalf and persuade them to reduce the total amount of the loan.
The creditors will then analyze the income vs.
expense graph of the debtors and assess their actual paying capacity.
They will then decide upon a reduced loan amount.
If negotiated well, this reduced amount can be as low as half of the original amount payable.
Hence you should choose a company which chalks out a concrete plan which will lead to a 50% reduction of your original loan amount payable.
A company trying to convince you to accept anything less is most likely pulling a fast one on you.
Hence you should only choose a settlement which convinces you that they will help you to save money from the total outstanding.