Debt settlement is when your debt is settled for less than what you currently owe, with the promise that you’ll pay the amount settled for in full. Sometimes known as debt relief or debt adjustment, debt settlement is usually handled by a third-party company, although you could do it by yourself, do you really have the time and experience to negotiate with lenders?
Debt settlement can provide financial relief and put you on the path toward rebuilding their credit. For the creditor, debt settlement enables them to receive at least some of the money they’re owed rather than no money at all. Furthermore, it may mean that you can avoid filing for bankruptcy. Normally, debt settlement involves money you owe to credit card issuers, rather than other types of debt. But you may be able to settle other unsecured debt as well.
