Posts Tagged ‘debt settlement company’


Debt Settlement Law Firm vs Debt Settlement Company
Tuesday, August 24th, 2010

Unless you have been living under a rock, you should understand that the American marketplace has seriously gone down south. People have been losing work, their places of residence, and many their sanity. A single difficulty that has pretty much been haunting consumers since this has occurred is large amounts of consumer credit card debt. Debtors can be found trying to beat large monthly premiums that practically never seem to go down plus interest rates that are totally absurd. One plan that has been truly proving to be a success for most consumers is credit card debt settlement; however there are two forms of debt settlement programs. Currently, there are business models that can be setup using a lawyer and then programs that can be set up with a standard service. The former is what will be able to really present debtors a great possibility to become debt free in the least amount of time with the least amount of concerns.

With a credit card debt settlement program, the debtor must fall into delinquency on their minimum payments and save money on the side. This will allow them to in time work out a one time lump sum payment and close the deficit out. Oftentimes the consumer can salvage about half what they owe plus find themselves out of debt in just a couple years. That is very good; however there are a couple downsides with debt settlement that can make using a lawyer more beneficial to the consumer. For starters once you fall past due on the debts the lenders can try to gather the balance due through calls. A law firm has the ability to lawfully limit collection agencies from constantly harassing the client, at which a company cannot. One more downside to the debt settlement plan will be the potential for getting sued. With having retained a law firm, then they will lawfully interact with and still negotiate with a bank who will be making an effort to take somebody to the courtroom. This is a great selling point for people when using a debt settlement law firm over a company.

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What is Forgiven Debt?
Monday, March 8th, 2010

After a debt settlement company has negotiated a reduced debt balance on behalf of their client, it is the client’s responsibility to report the amount of debt removed to the IRS.  According to IRS Publication Form 982, any amount of removed debt above $600.00 must be reported as taxable income.  This means that the creditor whom the debt was owed to has to provide the debtor with a 1099-C tax form which clearly states the amount of removed debt.

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