Owing a significant amount of credit card debt can be frustrating and overwhelming for a Tennessee consumer. It’s stressful to know that you cannot make even a minimum payment or ever get ahead on what you owe. When you are also experiencing calls from debt collectors and facing things such as wage garnishment, you are probably going to be looking for a way out, fast.
One thing that many people consider for debt relief is credit card settlement. This is exactly what it sounds like, which is working with the credit card company on an amount you can pay to settle your account. In some cases, it makes sense, and it can provide fast relief for some consumers. However, there are some drawbacks to this decision, and it’s in your interests to weigh all options before moving forward with a major decision.
What are the benefits?
Of course, the main benefit to credit card settlement is getting rid of credit card debt. This can relieve you of much of the stress you’ve been experiencing regarding your finances. In one payment or in a short amount of time, you’ll be rid of this burden. Many times, credit card companies will accept a lower amount than the total you owe, which means you could save money. For some people, one of the positive aspects of settlement is that it is an alternative to bankruptcy.
What are the drawbacks?
Credit card settlement does not make sense in every situation. Even if you get rid of this particular type of debt, there could be other balances you will need to pay. Additionally, it is likely you will have to come up with a large sum of money to pay the company the full settlement amount. Settlement can still impact your credit score, and it can also have some tax consequences as well. Before you decide on this step, you will want to think carefully about the implications of moving forward with this process.
Your financial future
Bankruptcy may not be your first choice, but there are many times when this option truly makes the most sense. This process can allow you to discharge not only credit card debt, but also medical debt, personal loans and more. If you would like to learn more about how this option can allow you to achieve a better financial future, you may want to speak with an experienced attorney about your legal options.