Consolidate Your Debt - A Debt Settlement Letter is your First Step

When you have more than one loan, several credit cards and a mortgage to pay, you may find yourself in difficulties at the end of the month when you have to make your payments if your budget is tight and an unexpected expense comes through. It may be the point in your life where you find yourself facing a large amount of debt that you are unable to pay in a timely manner. Debt consolidation may help you restructure your payments into a more feasible schedule.

Many companies exist who claim to help with this process. Unfortunately, some of these companies are not trustworthy, only expensive. Use the Internet to research the companies you are interested in and choose one based on the services they can offer you. But make sure you have all the information and have compared all the services they provide, the fees they charge for their services and if they have a solid track record and happy customers’ testimonials.

Another way of dealing with it is by doing it yourself. Yes, you may choose to contact your creditors yourself and work out a payment schedule. Your first step in this process should be a Debt Settlement Letter.

Creditor Name:

Address:

Date:

Your account no

Dear Sir/ Madam,

I am currently going through some financial difficulties and am concerned that I will not be able to meet my monthly payments. I do not want to declare bankruptcy. I would like to try and work out an alternate plan for my payments so I will be able to continue to make some payment to your company and not default on the loan.

I feel that the following is an acceptable alternative for all parties involved. If you could close my account, put aside the interest payments and accept a new balance of (suggest an amount-usually fifty percent) of my current balance. I will be able to make a monthly payment of $_____.

(You may give some limited detail about your financial trouble to aid in the decision-making)

I feel confident that the above plan will work. Please call me with any questions and we can work out a final plan. If you can’t adjust the payment plan I will be required to default on the loan. I am determined to pay all creditors who are able to work with me and my consolidation efforts.

Sincerely,

Your Signature

Your Name (printed)