Debt Settlement and/or Negotiation are an aggressive approach to debt reduction, which is appropriate for debtors with a serious amount of unsecured debt or who are considering bankruptcy. HOWARD | NASSIRI, LLP contracts the legal support services of Morgan Drexen Integrated Legal Systems to assist it with negotiations with creditors to settle your debt for a lower amount than owed. After the debt is settled, the creditor will send a letter stating that you have fulfilled your debt obligation and will report to the credit bureaus that the debt has been “Settled for less than full amount”, “Paid” or “Settled.”
Creditors will usually settle for less than owed when the debtor is under serious financial strain because the creditor gets nothing if the debtor chooses to file bankruptcy. Creditors want to get as much money back as they can.
Debt Settlement is a way to get out of debt in the shortest amount of time, and with the least amount of money without filing for bankruptcy. There are some drawbacks though. The IRS considers a forgiven debt as taxable income, so at the end of the year, they will expect you to pay taxes on the settlement. The IRS, however, has a form (#982) available for special hardships. Debt Settlement can also be harmful to a debtor’s credit-rating while they are in the process of settling their debts because creditors won’t agree to settle on an account that remains current. The debtor’s credit report will reflect that they are behind in payments until the debts are settled.
To find out more about HOWARD | NASSIRI’s Debt Negotiation program and to get on the road to financial freedom, please contact HOWARD | NASSIRI, LLP for a free consultation.
Creditors will usually settle for less than owed when the debtor is under serious financial strain because the creditor gets nothing if the debtor chooses to file bankruptcy. Creditors want to get as much money back as they can.
Debt Settlement is a way to get out of debt in the shortest amount of time, and with the least amount of money without filing for bankruptcy. There are some drawbacks though. The IRS considers a forgiven debt as taxable income, so at the end of the year, they will expect you to pay taxes on the settlement. The IRS, however, has a form (#982) available for special hardships. Debt Settlement can also be harmful to a debtor’s credit-rating while they are in the process of settling their debts because creditors won’t agree to settle on an account that remains current. The debtor’s credit report will reflect that they are behind in payments until the debts are settled.
To find out more about HOWARD | NASSIRI’s Debt Negotiation program and to get on the road to financial freedom, please contact HOWARD | NASSIRI, LLP for a free consultation.
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