The Educator's PLN

The personal learning network for educators

Factors to Consider before Opting for Debt Settlement

When the times are tough financially and your business is on the rocks because of debts, settling them with your creditors may be the only option remaining. However, before making that decision, you want to make sure that it is the right decision to make. It is worth noting that debt settlement affects your credit score, making it difficult for you to qualify for other loans in future. As such, if there is another option, you will want to look into that first.

To know for sure that you are not only making the right choice for your business but also ensuring that you won't be in the same state again, the following are some of the factors to consider.

How did you end up in debt?

The first thing to look into, as much as you may want to assume, is the reason why you ended up in debt in the first place. What led to you looking for company debt help? This is aimed at ensuring that you do not find yourself in debt in future. Make the necessary changes on your expenditures including avoiding those that can be avoided. The last thing you want is to keep running for debt consolidation every now and then.

The rate of interest

When negotiating with your creditor to forgive some of your outstanding loans, the main idea is to reduce the rate of interest on the credit. This saves money both in the short and long term. That makes it essential to ensure that you are getting a reduced rate before signing the settlement deal. Moreover, it is aimed at enabling you to make the repayment, especially when you are not financially stable. 

So if you are faced with the option or have the ability to negotiate for lower rates, do not hesitate. On the other hand, when settling for a better rate of interest seems like impossibility, it would be better to repay your loan instead of settling.

Identify the problem

When considering debt consolidation, it is an important to note where the problem is with the repayments. One of the most common problems is multiple repayments. For many people, their busy schedules and a lot of loans that require payment is the reason for defaulting in the repayment of specific loans. When it has proven difficult to keep track of all your due dates, then negotiating with your creditor to allow for a one-time lump sum settlement would be wise.

You may consider negotiating for a future repayment date if you are expecting cash in the foreseeable future. That way, you avoid being recorded as a defaulter during the period you are not repaying – note, though, that interest on the loan is accumulating.

Seek assistance

If loan consolidation is a whole new thing to you, it is advisable that you seek assistance from professionals on the best arrangement. You could opt for a debt settlement company or a consultancy firm offering the same services. Be vigilant though since the market has its share of fraudsters who will promise better repayment terms.

Conclusion

Settling your debt may seem like the best thing to do, but that is not always true. Considering the factors highlighted in this article will help you make the right choice.

Views: 123

Comment

You need to be a member of The Educator's PLN to add comments!

Join The Educator's PLN

About

Thomas Whitby created this Ning Network.

Latest Activity

Profile IconSharon Boling, Jerry Hansen, Sara Maynerich and 40 more joined The Educator's PLN
9 hours ago
Ruth Herman Wells posted an event

Seattle WA Teacher Behavior Management Professional Development Workshop at Marriot Courtyard South Center

April 23, 2020 at 9am to April 24, 2020 at 4pm
Got Problem Kids? Here's your Problem-Student Problem-Solver Workshop. You name the problems and this workshop delivers hundreds of immediate problem-stopping answers. You will leave with innovative, more effective strategies for school failure, truancy, dropping out, work refusal, violence, delinquency, bad attitudes, depression, and more. Online workshop, college credit and free clock hours also available. For more info go to our website,…See More
Friday
Deidra Campbell liked Thomas Whitby's blog post Parent Communication Isn’t What It Once Was.
Jul 6
Daisy Hastings posted a blog post

How and Why To Get Into National Honor Society

The National Honor Society (NHS) is an organization for the high-school students. It is dedicated to recognizing and appreciating the young ones for their excellent performance at educational establishments. Hence, those who satisfy the membership requirements laid down by the school’s chapter can apply for the NHS membership.How to get into National Honor Society?The first task is to figure out if your school consists of an NHS chapter. And, if it does…See More
Jun 24
Christine Hinkley posted an event

OLC Collaborate Maui at University of Hawaii Maui

September 19, 2019 at 8am to September 20, 2019 at 5pm
Join your fellow digital learning education professionals, educators, and administrators to network with experts and collaborate on solving the challenges we all face in online higher education today. You’ll get the chance to hear from regional experts regarding current and emerging trends in online learning, collaborate and network with your peers during group discussions on top-of-mind challenges that may impact the future of online, blended, and digital learning – and your career.See More
Jun 20
Sarah Martyn liked Bill Burkhead's blog post Principal Entry Plan-The First 100 Days
Jun 20
Christine Hinkley posted an event

OLC Collaborate South Carolina at Anderson University

October 10, 2019 all day
Join your fellow digital learning education professionals, educators, and administrators to network with experts and collaborate on solving the challenges we all face in online higher education today. You’ll get the chance to hear from regional experts regarding current and emerging trends in online learning, collaborate and network with your peers during group discussions on top-of-mind challenges that may impact the future of online, blended, and digital learning – and your career.See More
Jun 12
Profile IconJess, Sofia Walmont, Donna Haggerty and 59 more joined The Educator's PLN
Jun 11

© 2019   Created by Thomas Whitby.   Powered by

Badges  |  Report an Issue  |  Terms of Service