Christian Credit Card Debt Settlement, also known as credit card debt negotiation, is considered to be the fastest and least expensive method to eliminate unsecured debt problems. It is an aggressive approach to reducing debt and is best suited to Christians who have been under severe financial strain and are exploring bankruptcy as a possible alternative.
Debt settlement is a negotiation process whereby the debt settlement company approaches your creditors with “offers” that are significantly less than the balance you owe. The creditors review these reduced offers and an agreement is reached that allows you, the debtor, to payoff the current balance for “less than” the actual amount owed. This “negotiating down” of the current balance is the source of the commonly used term, credit card debt negotiation. Debt settlement firms negotiate your entire principle balance, regardless of any interest or finance charges that creditors have added to your account. A Christian Debt settlement Program typically results in an average 40 to 60 percent reduction in your balance, although results will vary.
Debt settlement firms are “for profit” companies that are independent and not affiliated with your creditors. They do charge fees for performing their negotiation services and maintaining contact with your creditors, although the fee structures will differ by company. Credit card debt negotiation firms will often finance their fees over a period of time. They realize that individuals needing their Christian debt reduction services are having financial difficulties.
The length of time it takes to complete a Christian debt settlement program is almost solely determined by the amount of discretionary cash that the individual(s) can set aside and accumulate for the “lump sum negotiation process”. Most programs are anywhere from 12-42 months in duration. Consumers do like the flexibility that a Christian debt settlement program offers in the way it allows them to set aside a predetermined “goal or targeted” amount for future creditor settlements. If one month, expenses in the household are high, they can set aside a slightly lower amount than their targeted plan, and catch up the following month. They can also use any lump sum cash they receive during the year (i.e. bonuses, tax refund) to speed up the process by setting those monies aside for creditor settlements.
During a debt settlement program, the monthly creditor payments are not being made by either the individual debtor nor by the debt settlement company. Therefore, this does cause delinquency on your accounts and this becomes part of your credit history in the pay history section. This “open delinquency” remains on your credit until the debts are “settled”. Because of the stoppage of monthly creditor payments, debt settlement does not have a positive impact on your FICO score. On the other hand, those proponents of debt settlement as it relates to the topic of credit, point out that it does lower your debt to income ratio more quickly than any other Christian debt reduction plan available. Your debt to income ratio is an important measurement used by lenders to qualify you for loans. For more information about Christian debt reduction and Christian debt settlement programs Click Here to see our Frequently Asked Questions (FAQs) section.
