What is Florida Debt Resolution?

Can I Benefit More From Debt Resolution Than From

 A Florida Debt Settlement Company?

To fully understand debt resolution, first you must understand the debt settlement process.  Both options debt settlement and debt resolution are working towards the same end result; to help struggling debtors find a solution to an unmanageable debt problem and get out of debt. There is a difference between a debt settlement company handling the process and the protections offered through a Florida law firm’s debt resolution process.  

When researching Florida debt relief options using debt settlement benefits those most experiencing financial hardships with credit card debt while trying to avoid bankruptcy.  

Outside of bankruptcy there is no other method of debt relief that allows consumers to resolve their financial problems quickly while potentially reducing the amount owed on their current debt balances.  

But before jumping into any type of debt settlement program you must first understand the potential drawbacks that could occur while following this process. 

Most drawbacks with debt settlement stem from falling behind.  In case you are not already aware of it, you must be in default on the credit cards debts in order for the creditors to be willing to negotiate a settlement. So if you are current and can pay back in full on your debts then this most likely is not an option for you to consider. 

Why is that?  Because when you are current and only paying your required monthly minimum payments the creditors have you precisely where they want you; stuck running on their credit treadmill.  There is not a creditor in the world that is willing to accept less than the actual balance you owe them when you keep paying on time each month.

 Debt settlement just like debt resolution is a “hardship program”, which is available to consumers who are in serious financial trouble.  These programs are not designed for the debtor who is not in a hardship and is comfortably paying back their debts.

Naturally, when you fall behind there will be negative remarks placed on your credit report in the beginning while going through this process, there is no avoiding it.   

But if you’re focused on your ability to get into more debt in the future before resolving your current debt situation you need to change your mindset first before proceeding!  

Unsecured revolving accounts, (credit cards) are basically a trap that has over the past few decades captured unsuspecting consumers into a lifetime of minimum payments! Since 2000 easy credit has exploded the amount of credit cards issued to an excess of 60 million cards and is a major contributing factor for this country’s recent credit crisis.  

Your credit score is just a snap shot in time and fluctuates over a course of your credit history. Once you have completed the program and paid off the debts you will no longer have negative remarks placed on your report and it will improve. You can’t trash your score forever! 

According to Fair Isaac Company, the creator of the FICO scoring system, your negative remarks diminish over the course of time. How much time? Well the greatest impact is in the most recent 24 months of your report.  

The major banks are always willing and do issue credit cards to almost all consumers at any point of their credit history so if your score is low the rates and limits may not be to your liking but… 

When you can’t manage the debt you have now why are you concerning yourself about getting more later? Remember if you are focused on getting into debt you will end up with more debt! 

Other than the negative credit score affects, the other negative drawbacks from going into default are collections calls and the possibility of a lawsuit.  This is where debt resolution differs from your standard Florida debt settlement company.

How are collections calls handled with a Florida debt settlement company? And how do they differ with debt resolution?   

The Fair Debt Collections Practices Act (FDCPA) is a law written to protect consumers from abusive collections companies. This piece of legislation states that once a 3^rd party collector has been notified that a consumer has retained the services of a law firm to handle their financial affairs they must defer all contact to the firm, not you!  

It is illegal for them to continue to contact you once they have been notified. You have the right to sue them for as much as a $1,000 each time they violate your rights!

A standard debt settlement company does not have the legal power to stop collection activity.  The best they can do for their clients is advise them to issue a cease and desist letter; which in some cases will do nothing but stir up the hornets’ nest and possibly prompt further legal action from the collectors, possibly a law suit. 

Can Florida debt settlement companies do anything about law suits?  

No! A debt settlement company without an attorney that can represent you in your jurisdiction can not negotiate with the collectors opposing attorney once it is in litigation. If they do they can be brought up on charges of unlicensed practice of law and the growing trend by collectors is to file complaint against them. So what happens next is the consumer will be left in the cold trying to figure out what to do and may very well end up getting a judgment. 

If I am sued is there something that still can be done through debt resolution?  

Yes, when you have a law firm representing you in the matter of negotiating debt, the law firm will still have the legal power to contact the opposing attorney and work out an agreement.   

The goal is to resolve the debt issue outside of the courtroom and work out an agreement to dismiss the case. This can result in the client never needing to appear in a court room. This is referred to as, “settling out of court.”   

Consumers who are financially suffering and can’t continue to maintain their monthly minimums payments, due to the bad economy or other personal difficulties have a options. They can attempt to resolve their debt first through debt resolution or file bankruptcy.  

There are a lot of horror stories about consumers hiring poorly run debt settlement companies as well as the companies that are just outright scams. Unfortunately many consumers do not research the company they hire. It is extremely important that you do your research first before signing up with any company! 

If you find yourself in trouble with credit card debt and need to figure a way out of debt then consider looking into the debt resolution process with a reputable company. 

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