What is Debt Settlement?

Georgia has one of the highest rates of consumer debt in the country, according to the Urban Institute. Residents in Lilburn and throughout the state are currently contending with various forms of consumer debt. Nationally, about 22 percent of the population has consumer debt. In Georgia, 30 percent of residents are currently facing various types of debt. To be clear, the percentage of consumer debt in Georgia is significantly higher than the national percentage. About one-fourth of all people in white communities in the state, and about 36 percent of all people in communities of color, carry consumer debt. That debt includes credit card debt, medical debt, student loan debt, and many other forms of debt.

If you are one of the many Georgia residents struggling with consumer debt, you are likely considering various options. One of the options you should consider is something known as debt settlement. What is debt settlement? Our Georgia debt settlement attorneys can explain.

Basics of Debt Settlement 

Debt settlement, which can also be known as debt relief, is a process through which you reach an agreement with your creditor(s) to pay less than the total amount of debt you owe. Why would a creditor agree to this?

In short, it can be costly for creditors to take legal action to collect on unpaid debt. Rather than going to the trouble and incurring the expense of taking legal action, creditors will often agree to debt settlements. This way, the creditor can recoup a portion of what is owed. For the debtor, the debt settlement is a way to get out of debt without having to repay the full amount owed. The idea is that the creditor and the debtor gain a benefit from the debt settlement agreement.

When Should I Consider Debt Settlement? 

Should you consider debt settlement? This is a question that many Georgia residents consider. While there is no straightforward answer that applies to all individual circumstances, the following are some reasons debt settlement might be a good option for you:

• You owe a significant amount of debt and are behind on one or more payments;
• You have debts that have been sold to debt collectors, and you are being contacted by them; and/or
• You are not earning enough money to pay what you owe on a biweekly or monthly basis.

In short, debt settlement is typically best for consumers who are having trouble repaying debt and are behind on payments. If this is your situation, it is a good time to seek legal advice about your debt settlement options.

Contact a Georgia Debt Settlement Attorney 

If you are dealing with a significant amount of debt, working with a lawyer to negotiate a settlement could help you immensely. While some companies might offer debt relief or debt settlement options, the best way to negotiate a fair debt settlement is to work with an experienced Lilburn debt settlement attorney. Our firm is here to help you. Contact Konn Law Firm LLC today to find out more about getting debt relief in Georgia.

Sources:

apps.urban.org/features/debt-interactive-map/?type=overall&variable=totcoll&state=13

irs.gov/taxtopics/tc431