There is a better alternative than attempting to escape the debt. You can create a true win-win situation by settling the debt with the creditor.

It is our experience that the average consumer settles a debt for about 75 cents on the dollar. It is also our experience that a professional negotiator will settle an average debt for about 60 cents on the dollar, including their fee. There is rarely a good reason to attempt your own debt settlement. Creditors will not take you half as seriously as they will take your attorney or professional negotiator.

In our experience, the consumer rarely has sufficient funds to repay a debt in full when a creditor demands payment. In many cases, much of the debt represents interest and penalties accrued while the consumer was unable to pay. It will be in the best interests of both parties if a reasonable arrangement for settlement can be reached.

However, you cannot expect to reach an affordable settlement if the creditor thinks he has the upper hand. For example, you tell a creditor that you really need to get this debt settled to get into your dream home. The creditor may insist on the full balance. Collection agencies will always agree more readily to remove the negative listings than bank or credit card companies. These are cases when you may have a real problem with collection agencies. This is when they represent a larger, institutionalized creditor.

You have the natural advantage in debt settlement, because you have something the creditor wants. You must hold out for your terms until the creditor gives you what you want. One you've written that settlement check, your advantage disappears. Get your terms in writing before you even open your checkbook.

Fortunately, creditors make their profits by collecting from their customers, not reporting negative credit information. Many creditors will agree to remove a negative listing upon settlement of the debt, if handled correctly.

Do not expect a creditor to meet an agreement that was made verbally. Everything must be in writing and, even then, you will probably have to fight to make the creditor live up to his end of the bargain.