Debt Settlement - The Truth

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A total of 623,399 U.S. bankruptcies were filed in the first three quarters of 2007, representing a 40.16 percent increase over the 444,789 cases filed in the same period in 2006. There's worse news in the Midwest; specifically in Detroit. Through October 2007, the number of Chapter 7 personal

bankruptcies filed in Detroit's federal bankruptcy court jumped 63 percent compared with the first 10 months of last year.

Unfortunately, this news is not surprising; after all, foreclosures are at an all-time high throughout the country and credit card debt is skyrocketing. If you find yourself in a situation where you're barely able to keep your head above water, yet have a strong desire to avoid bankruptcy, you may be

considering debt settlement. Prior to making a final decision, however, it's important that you review the following information regarding this form of debt relief.

What is Debt Settlement?

Debt settlement is a process utilized by individuals (or professional firms representing those individuals) in which they negotiate with their creditors to pay their credit card debt in full for less than the balance (typically 50% or less).

Who Should Consider Debt Settlement?

If your debt is out of control, and you're losing sleep at night you're very likely a good candidate for debt settlement. This is especially true if you find yourself borrowing from one credit card to pay another or you're having a tough time avoiding the dreaded bounced check.

Please keep in mind, however, if you should choose debt settlement you must have some type of funding available to pay your creditors when a negotiated settlement is reached. Many people have accessed a home equity line of credit or retirement fund. Others have been fortunate enough to borrow

from friends and family, or simply set aside a certain amount of money each month to go toward future negotiated settlements.

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