If you are looking for one of the fastest ways to resolve your credit card debts and medical bills you should take a look at debt settlement, also known as debt negotiation. It has worked in years past and it will continue to work in 2012 and beyond.

Why does debt settlement work?

Debt settlement is an alternative to bankruptcy. However it is better than filing bankruptcy for both you and the lender. Let’s look at an example from the corporate world to see why.

American Airlines just filed for bankruptcy protection to help it shed some of its debts. In the process the shareholders equity is wiped out and the stock is essentially worthless.

If the shareholders had the option of getting 25%, 35% or even 50% of their investment back instead of zero don’t you think they would have taken it?

This is what happens when you use negotiate with your creditors to reach a fair settlement of your debts before you are forced to file bankruptcy. You avoid a black mark on your credit report for 7 to 10 years, you get to reduce your credit card debts and medical bills by as much as 75% and sometimes more, and your creditors are satisfied getting something back on your account instead of having to write off the full balance as a total loss.

This is why debt settlement still works in 2012. People just like you are struggling every day with job losses or work reduction, medical bills, back taxes, student loans, and a sluggish economy.

The major credit card banks are aware of this and will work with you to settle your unsecured debts once you are about to file bankruptcy. They will accept pennies on the dollar instead of losing your entire balance as a bad debt.

They won’t work with you if you are current and making at least the minimum payments each month. They will only work with you once you have demonstrated a financial hardship and shown you are unable to make your payments each month for at least 4, 5 and 6 months.

At the 6th month mark that is when they are forced to write off your account as a bad debt and take the loss on your account. It is at this point that you can make a settlement offer and stand a good chance of it getting accepted.

You can do it yourself or you can hire a debt settlement company that will do it for you an a contingency fee basis – meaning they will only get paid if they deliver results.

Filing bankruptcy is a last resort option and has terrible consequences on your credit reports and credit scores. Take a look at what debt settlement and debt negotiation have to offer you before you file.

Debt settlement works to offer you debt forgiveness without the negative mark of filing for bankruptcy.

You can start by getting a free confidential debt analysis and see how much you can save