As humans, we need money to build a life, to pay our mortgage, to feed our children, to buy medicine and so much more. But when we don’t have the money we need, we tend to borrow from our family, friends, banks, or anyone that might have money to spare.
This might sound like an effective way to live, but it’s similar to buying hope. While you can use that borrowed money for things you need – maybe a new house, a car, or a better life – this is only temporary. If you find yourself unable to return that money, you go into debt.
Debt simply means owing more money than you can afford to give back. When you find yourself in this situation, you can hire professional debt negotiators or you can do it yourself. What exactly can these debt negotiators do for you? If you’ve found yourself in a tricky financial situation, you don’t have to face your future alone. In this guide, we’ll explore what it’s like to work with a debt negotiator as well as what they can do for your debt.
What Is A Debt Negotiator?
Simply put, a debt negotiator helps you get out of debt. Anyone who’s been in debt knows it acts as a cycle. You first take on a small bit of debt, and it seems harmless at first. Then, later down the line, you find yourself unable to pay back this amount as quickly as you thought. You might need to take a bit more out to pay for this. This cycle continues until you’ve found yourself struggling under your own repayments.
A debt negotiator can step in to help you carry this burden. They’re skilled financial professionals who know how to achieve a life free from debt. Because they’re experienced with helping others reclaim their financial future, you can take a backseat and focus on things that matter more, like paying down your debt faster. Now, let’s talk about the specific ways debt negotiators can help improve your situation.
1. Debt Negotiators Can Deal With Your Creditors For You
Dealing with creditors is one of the most stressful parts of struggling to overcome debt. If you’re dodging calls and incoming mail, you need a professional debt negotiator. Your debt negotiator’s first step will be to talk with your creditors on your behalf as soon as possible.
If you cannot make your payments on time, you need to contact your creditors. This can be intimidating if you don’t know what to expect, and that’s why a debt negotiator is so valuable. They’ll contact your creditors for you to see if there’s a repayment option that’s better for your needs. Believe it or not, creditors are usually willing to change your repayments.
2. Negotiators Can Lower Your Monthly Debt Payments
Since your debt negotiator can contact your creditors on your behalf, they can actually help you achieve a faster pay off schedule. Most creditors are willing to settle or offer a new repayment plan if it means they quickly get back the amount you owe. They understand that people face financial hardship, and they usually want to avoid any large losses.
Here are some things debt negotiators can do on your behalf to lower your payments:
- Payment Extension – If you’re experiencing a temporary problem, a debt negotiator can discuss an extension with your creditors by letting them know when you’ll be able to resume making payments.
- Interest Adjustment – If your interest rates are currently too high, a debt negotiator can ask your creditors if there is room for adjustment.
- Reduce Fees – When you’re unable to make payments on time, you’re subject to late fees. These can add up quickly, and a debt negotiator can either negotiate them down or eliminate them altogether.
- Repayment Plan – As we mentioned before, creditors just want to get some of their money back. Offering a new repayment plan is a great alternative to defaulting on your payments.
These are all great benefits that help ease the stress of dealing with long-term debt. Sometimes that’s all it takes to get back on your feet.
3. Settle Your Debt For Less Than You Owe
One of the biggest things debt negotiators can do is actually settle your debts. There are a number of financial agreements they can use to help with your debt, such as an informal payment arrangement, debt agreement, and more. This is when your debt negotiator and your creditors settle your debt, and the creditor agrees to accept lower funds as final payment of your debt.
However, it’s important to note that, for a settlement, you’ll most likely need to be prepared to pay your debt off quickly. Even with a repayment plan, you’ll need to uphold your side of the bargain. This can still be an effective way to get out from under your debt quickly for less than you owe.
4. They Know The Industry
Having a debt negotiator on your side is like having an insider who can tell you the right steps to make. When you’re struggling with debt on your own, you likely don’t have the full story. You don’t know what options are available to you because you’ve never been a creditor, and you don’t work with creditors often.
A debt negotiator knows the credit industry inside and out. They know how to help because they’ve helped countless others who were in your exact shoes before.
Because they deal with creditors on a daily basis, they know what to expect. They might even have built relationships with common creditors, and they can use this relationship to your advantage when negotiating for you. This insight is worth its weight in gold.
5. Professional Negotiatiors Can Help You Build a Budget
Too many Australians are going through their daily lives without a proper budget. In fact, 86% of Australians don’t know their monthly expenses. It’s important to prioritise your budget and be honest about how much you can pay. Understanding how a budget works and what money you have to work with can be complicated if you don’t have a financial background.
With a debt negotiator, you’ll have someone to talk to about your monthly budget. They can help you review your income, expenses, debt plan, and more to decide on a budget that works for your needs.
A great way to learn more about budgeting is to note down every purchase you make for a month to see how you use your money. If you are buying things that are not indispensable, you could consider removing those things from your life, at least until you have paid your debt. A debt negotiator could provide much-needed clarity during this process.
How to Choose the Best Debt Negotiator
As previously stated, trust your instincts. Be very careful to those emails that come all of a sudden offering debt negotiation services. Most debt negotiators rely on their old clients referring them to friends and family. Good credit or debt negotiators are not the ones that use heavy telemarketing methods or big commercials.
Your second step is to interview more agencies, see what they have to offer, and ask around for recommendations. These days, the internet has grown so much that you can find forums dedicated to debts negotiators in your area.
Another smart idea is to ask for a written brochure of their services so you can see what you are getting into from the start. This brochure should also provide you information on the fees you will be charged if you choose their agency. You’ll need to budget this into your process.
Before you choose a debt negotiator, always check if any previous customers have filed complaints against them. Finally, ensure the debt negotiator company you plan to use has a credit licence and if they are fully accredited to offer financial services.
What Are Your Next Steps?
Your first step should be talking to the debt negotiator you trust. They’ll help guide you through the process of what comes next. Come prepared to your first meeting with information and documents about your situation, as well as an idea of what you can afford to pay towards your debts.
Communication is always the most essential element. Because you want to come to a conclusion that works for you, make sure you’re prepared with all the paperwork they need to get started.
They should be able to negotiate a repayment management plan that benefits you. You might pay your debts at smaller or no interest. Or they might cut out some of your latest fees or penalties. In return, you will be expected to make a regular fixed payment to your debt negotiators.
Now, instead of giving money directly to your creditors, you will pay the debt negotiators and they will handle the money on your behalf according to your agreed upon plan. Now that someone else is taking control, you can focus on paying down your debts with confidence.
Are you ready to get started? We’re here to help! For more information about our debt negotiation services, get in touch with us for an obligation free debt consultation. We’ve been helping people overcome their debts for over ten years. We offer the first step towards a better life and our solutions are tailored to your individual situation. Contact us today by filling in the enquiry form below or calling us on 1300 368 322.