Debt Relief of America is a company dedicated to helping clients manage their debt situation through different programs such as consolidation, to reduce the high interest rates charged by their creditors. They also broker actual debt settlement arrangements, and negotiate with creditors to get them to agree to accept a lower amount than what is actually owed to them.
It is important to understand that, while no creditor is ever legally obligated to accept less money than the current outstanding balance, many do feel that it is worth their while, in the long run, to accept arbitrated settlements as a guarantee that they can recover some (if not most) of their money, rather than risk losing it all in the event that the borrowers are forced to file for bankruptcy. In some cases, creditors have been known to write off as much as 50% of the balance due, payable either in a lump sum or through a limited amount of payments. Debtors should realize, however, that they might have to pay “income” tax on the amount saved. Writing off debt is never totally “free”.
The phrase debt management or debt counseling is, perhaps, more familiar to the public than debt settlement. Under this type of program, Debt Relief of America is able to negotiate with creditors to get you lower interest rates. Once a new rate is agreed upon, it cannot be changed. In addition, Debt Relief companies can often get creditors to accept lower minimum payments each month making it easier for people to keep on top of their payments rather than risking any kind of default. Defaults can eventually lead to their being sued, liens placed on property or even garnishments against their salaries. However, no creditors can do any of these things without first going to court and getting a legal ruling in their favor.
This company is well known, however there are many debt relief programs available to you. Companies offering debt reduction counseling charge a fee for their services, it is therefore wise to shop around and find one that can help you and save you money. Inform yourself well before making any agreement and ensure that you are dealing with a reputable company.
