Will creditors accept less than the full amount owed?

Creditors balance the risk of no payment, the cost of collecting the debt, and the ability of the account holder to pay the monies owed. When you have a financial hardship, lenders will look for signs of distress. Late payments, multiple delinquencies, and high credit balances are all signs of financial distress that could motivate the creditor to negotiate your debt.

What happens when I settle a debt?

When a creditor agrees to accept less than the full balance, they also agree to write-off the difference, relieving you from any future liability. After you settle a debt, it is illegal to attempt to collect additional money or sell your account to a debt buyer.

Can I negotiate a lower payoff on my debt?

You can contact creditors directly to negotiate a lower payoff. However, without extensive knowledge of the debt settlement process, you are at a distinct disadvantage. You must understand what settlement a particular lender will typically accept, and under what circumstances they will agree to a lesser payoff. Beginning negotiations too early could mean paying more than necessary while waiting too long could lead to legal action.

Debt Settlement

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REPRESENTATIVE EXAMPLE OF APR

For example, a $30,000 loan with a 4.99% APR over 5 years (60 months) would result in a monthly payment of $566, with total interest paid amounting to $3,959.97. This could save you thousands in interest compared to higher-rate debt.

ANNUAL PERCENTAGE RATE (APR)

Annual Percentage Rate (APR) represents the annualized interest rate you are charged for borrowing. It is the combination of the nominal interest rate and some additional costs such as fees involved when incurring debt. Our lender offers APRs for personal loans, cash advance loans, installment loans and debt consolidation loans from 4.99% to 35.99%. Since New Start Capital does not directly issue loans, we cannot deliver any specifics or guarantee the APR you will be offered. The APR depends solely on your lender’s decision, based on various factors including your credit score, credit history, income, and some other information you supply in your request. For more information regarding the APR contact your lender.