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Self-Employed Freelancers & Small, or Home-Based Businesses: REDUCE YOUR UNSECURED DEBTS & WEATHER THE STORM.
by Stephen Freeman
There you are playing the unsecured credit card game of "buy now pay later" when one day you wake up and you’re deep in debt and the boss (or maybe your spouse) says “get out.” Now what? Panic! Stress to find stability or another job FAST! Bankruptcy! It doesn't have to be like that if you use a money management tool known as settlement negotiations to trim just a few of your debts off... or all of them if you so desire… and weather the storm. If the truth were known you can actually use this method at any stage of your financial situation if you don't mind a slight blemish to your rating.
I have negotiated many debts away in the past and have recently written a book, titled Financial Downsizing; The ABC's of Settlement Negotiations. It concisely outlines the process of settlement negotiations and suggests a method for tracking them as well as provides tips on negotiating with the creditors. It is currently being sold via www.iph3.com. I hope this will benefit and guide you to a solution better than the stressful one's mentioned above... or worse yet, divorce.Settlement Negotiating... What is it and what does it do for me?
Settlement negotiating with creditors is a little known and obscure system developed by banks and creditors to recoup or mitigate losses when consumers, whom experience financial hardships, cannot pay their bills. Another term for the system is “in-lieu of bankruptcy settlements.”
Essentially, it is where the creditor accepts a lump sum payoff at an amount less than full balance and the consumers credit report is noted as: Paid/Less Than Full. Not a bad mark at all if you only have a few and maintain your other debts active and current.
The system was initially designed to allow you, the consumer, to lighten the load in your financial boat …before you sink the ship. In short, you are really guessing as to how long you can keep on taking in more debt before you need to lighten the load ...or sink. Certainly, some people will choose to paddle faster or work harder/longer hours and God Bless them for trying. But in many cases the storm is just a signal to look around and take stock of the important things around you. This is where the process of simply getting rid of certain debts NOW is far more practical than holding onto them while they drag you down and block your views of your future.
Settling your debt(s) is a tricky task. As one might imagine the lenders wrote the rules of this process and their goal is to get as much from you; regardless of how it impacts your situation. This book helps to level the playing field and achieve the lowest amount for payoff; in some cases as low as 25%. Some people will just buy the book as a planning tool and then when the time comes they’ll hire a professional like myself to do the work for them. Yet, even at $200 per hour, you’d be surprised how much home business work I perform.
Settling a debt can be done at any point along your financial road. I had one client who was a self-employed freelancer with A+ credit who had been credit card surfing and accepted too many of those low interest rate cards and ultimately when they went to the non-promo rates of 19% he could not make all the payments. He figured it would be easier to settle all of his cards. So, he negotiated 7 cards balances away and kept the remaining secured debts. His rating took a large dip and came back up to average range a year later, but he effectively reduced his unsecured debt from $70,000 to $0 with a payout of less than $25k. This allowed him to weather the seasonal storms of low work activity.
Many people naturally ask the question "where do I get $2500 for a settlement if I can't pay a $250 month payment?" Well, this is actually part of my book so I cannot divulge that here, but suffice it to say, it is easier than you think and I provide suggestions on where to look for those funds and or how to prepare for such an event.
Does this really work?
Absolutely, yes. As mentioned, the banks created this process, so you can bet they are going to benefit from the method. For example, last year in the US during the 4th quarter, personal bankruptcy filings increased by 35% due, in part, to those layoffs during the summer. If the process outlined in the book had been marketed to those folks I wonder how many would have been spared the stress of bankruptcy; just because they needed to reduce their debts. Furthermore, you can only file once in 7 years. Where as settlements can be performed as often as needed, but if used chronically your rating will be rather low. That is why I say it is perfect for incidental use to lighten the load and allow you to weather a storm.
For example, I once counseled a CFO, of all people, who was experiencing financial stress. She had a home, a rental house, nice cars, furniture.... the works. Bankruptcy was not an option. Her situation was initially created when she had taken off time for maternity leave and used credit cards to supplement her leave pay. Ultimately, she had decided to continue her leave for an extended period of time, but found that she was too far in debt.
Using the Financial Downsizing process she finally negotiated a little more than $30,000 of her credit card debt away for approx. $8500, thereby dropping her payments by almost $1000 per month and reduced her unsecured debt by 74%.
Suffice it to say, I believe there are superior benefits in most cases to support negotiating your balances away rather than filing bankruptcy.
Good Luck with your efforts and drop me a note to inform me how your situation turned out for you.
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Stephen Freeman is a self-confirmed "work-at-home" specialist, author, negotiator, investor/developer and corporate executive, amongst his more important interests; that of a father, husband, and friend. Mr. Freeman can still be contacted for PAID advice via his email address at authorsdesk@iph3.com. You can sign up for a free www.Paypal.com account to Send the Money and Questions/Notes for his Service... still only $1 per question, or you can mail him the questions c/o IPH. PO Box 764 Woodbridge, CA 95258. But, he advises everyone to simply read the BOOK first as many of the answers are there. Credit cards are accepted!
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