When it comes to getting out of debt there are a number of options that can be utilized, and while some are better than others, often times just taking action is the most important part. One of the worst things you can do is to ignore the situation or pretend that it will magically go away. Believe it or not, many people act as though ignoring their debt will somehow make it disappear, or at least they hope it will. Of course, the fact of the matter is that you need to act swiftly before your debt becomes insurmountable. Once things get out of control there are only a handful of options available that won't wreak havoc on your credit rating and on your ability to secure desirable forms of credit. One of these options is a debt settlement, which is a process that I personally used to clear my debts.

My story is not unlike many others in that I didn't find myself deep into debt overnight. My problems happened gradually and were fueled by an unfortunate job loss. My wife and I had been spending out of control and sort of knew that our spending spree would eventually get the best of us. Little did I know that I would lose my job and be unable to pay back multiple high interest credit card balances. As we began missing payments our interest rates continued to rise and the late payment fees started to stack one on top of the other. We knew we had to do something so we reached out to a trusted family friend that works as a financial advisor specializing in debt management. After carefully reviewing our options and figuring out that paying back our balance in full was impossible in the short term, we decided to move forward with the option of debt settlement.

For those that don't already know, debt settlement is a process by which a company works on your behalf to reduce the total amount you owe. The company you hire negotiates directly with your creditors to realize reductions of up to 70%. Debt settlements are great in that they can allow you to eliminate large portions of your debt without affecting your credit rating with the same severity that a bankruptcy claim will. While you don't necessarily have to work through a settlement company to negotiate with your creditors, it's strongly recommended that you do since companies are generally able to achieve a better result. That being said, it's critical that you understand what you're getting into before signing on the dotted line. You want to ensure that the fees associated with your settlement don't end up putting you in a worse position. The best types of settlements are those in which you only pay based on an agreed upon settlement amount. You will typically pay a percentage of the total amount in which your debt has been reduced.

Ultimately, there are many options for debt relief out there and it's up to you and your financial advisor to choose the one that's right for you. Debt settlement helped me clear my debts and it may be able to do the same for you.