Overview of debt settlement

Debt is a situation when a person is under the obligation of a person from whom he had borrowed some amount of cash. The borrower is also known as the debtor and the money lender is known as the creditor. Debt settlement is a situation in which both the creditor and the debtor come to a negotiable ground about various factors related to the cash borrowed by the debtor. The key factors on which the debt settlement depends are the amount of cash, time of return, interest rate, etc. Debt settlement is also known as debt arbitration or debt negotiation. The concept of debt settlement is an approach to reduce the cost of the balance that is to be paid back to the creditor by the debtor.

The amount of money that the creditor gives to the borrower is returned to him in monthly installments. If by any chance the debtor stops paying the installments and the balance continues to grow because of late fees, then there is a necessity of debt settlement. There are four ways in which the borrowers can settle their debt. Firstly it can be a personal settlement between the lender and the borrower which they conduct by their own. Secondly the borrower can take advices from internet web sites. Thirdly they can hire a lawyer who will fight for them in the court in case of any dispute between the lender and borrower regarding the debt. And lastly they can seek help from various debt settlement companies.

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