Credit cards are double-edged swords that could either help
you increase your credit score or push you into deep debt. Some actually
declare bankruptcy given that they’re using 90% of their income to repay their
credit card debts. However, debt settlement can actually remove 75% of your
debt than filing bankruptcy. Here are a few things you need to know to start.
1.
Credit Card Company attention
If a customer is unable to pay for his or her balance on
time and the debt is accumulating, rather than being a disadvantage, the bank’s
attention to you could be an advantage. At this point, the bank just wants you
to pay back your debt and they’ll close the account because it helps them avoid
charging the amount off their income statement, which directly affects their
stock fall. So they may let you pay at a lower debt settlement amount to save
time and their stock values.
2.
Bankruptcy
Once you declare bankruptcy, it is possible the bank can
wipe out your entire credit card balance because it is clearly unsecured or has
no collateral, just a responsibility of the debtor to pay. This is certainly a bad scenario for banks
and they will push you not to declare bankruptcy as much as possible, allowing
you to negotiate a lower credit card debt.
3.
Settlement Consequences
The two reasons above justify that banks could definitely
lower your credit debt settlement amounts, but there are some consequences on
your end. It could lower your credit score to the lowest ends. This might have
you some trouble in getting financing or credit in the future.
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