Debt settlement is a good option for those consumers who have multiple debts. Debt settlement companies settle debts for customers, one debt at a time. The main strength of debt settlement companies is their relationships with creditors. Debt settlement companies that have worked for years have some basic things that make them help the consumers to handle with debt problems. These things are: highly trained negotiators; experience in knowing how creditors settle; no personal emotional attachment to creditors, allowing better responses; extensive knowledge in consumer debt and in Fair Credit Reporting Act and Fair Debt Collection Practices Act (even though they are not lawyers); educational tools. Experienced companies have lawyers in the personnel who give individualized legal advice to consumer in any case. If there are serious problems they represent clients.

Debt settlement companies offer services to stop collection harassment. Some of the companies say they will contact consumer’s creditors and take over accounts, provide legal analysis of finance problems. When being in debt consumers get tired of creditors, so debt settlement companies request creditors to call them instead of the consumers. This can be a very valuable service for some consumers.

Debt settlement companies offer to consumers to set up an account and send monthly payments to that account. This is intended to build up a fund that can later be used to try to settle debt. The consumer is always I control of his/her money. A consumer may sign a power of attorney to allow the company to act as attorney in fact. When the company accumulated enough to offer a cash settlement to one or more creditors to pay off the debt the debt is settled for smaller amount of money that consumer has borrowed from the creditor.

A customer enrolled in debt settlement program may be surprised by the fact that debt settlement specialists ask him/her to stop paying debts. This is what consumers need to do because the longer they are not paying the creditors, the better deal they will eventually get from creditors. According to what a company representative has said, after twelve month of not paying and not talking to creditors they will fell that some money is better than none. Failure to pay will demonstrate a hardship condition that enables a debt settlement company to negotiate.