It is common for people to approach us regarding credit repair with accounts that are overdue, the whole reason a default is listed is due to an account being behind. What many people don’t realize is in many cases these debts can be significantly reduced given the credit provider is approached in the correct way.
Often the debt in question may be quite old, this is common with debt collection companies who often purchase old debt as the older the debt is the less they can purchase it for, will then try and recover the whole amount from the debtor.
The fact is that regardless of whether a default has been listed or not, in many cases the credit provider is highly motivated to get paid. In the case of unsecured debts credit providers know that other than listing a default or commencing court action their avenues to receiver debts are limited. Due to this they can be willing to negotiate if approached in the right way.
Often people are not comfortable approaching their creditors to discuss a debt reduction, especially if the account is in arrears, however the truth is this can be the best time to deal with these matters. While a credit provider will never be happy about accepting a lower payout figure it is a commercial reality that sometimes it is their best option and they know this.
In many cases they have two options, get paid some money now or continue to try and get paid, for many option one makes a lot of sense.
We have found that in come situations we have been able to save our clients up to 80% however discounts of between 40 to 60% are common.
The key is the debtor must have available funds to clear the creditor in a lump sum, payment plans seldom provide sufficient motivation to a creditor to substantially reduce a debt.
Debt negotiation can be complex and tricky, for most people engaging the services of a debt mediation company will give them the best possible chance of success.
The majority of debt mediation companies will only charge a fee based on the amount they have reduced the payout figure so its all upside for the creditor.