It is an unfortunate fact of life that many individuals fall in trouble with debt often times seeking short-term loans, like cash advance and payday loans, as a tool to escape smothering debt. The modern age has been distinguished by easy access to credit (any adult US resident can find a loan agency nearby on www.NearMePayday.Loan at any time of the day or night). While this can help fuel economic growth, it can also cause severe financial hardship for individuals who are not careful. Often times debt is a result of loss of employment, medical emergencies or excessive credit card usage. For some, the amount they owe accumulates over a matter of weeks or years and become nearly impossible to pay back in full.

Not all payday lenders offer debt settlement

Fortunately, for individuals that find themselves in this situation there are ways to get a handle on debt. Consumers can negotiate a debt collection settlement and as a result stop creditors from harassing them. Debt collection settlement can also be a start to leading a financially healthy life by way of paying off bills and becoming budget savvy.

A debt collection settlement is an agreement between a debtor and a collection agency acting on behalf of a creditor. Debtors can attempt to negotiate on their own as well but may have more luck with a professional representing them. In the case of a debt settlement, the debtor and creditor will come to an agreement in which the debtor can pay a percentage of what they owe and be free and clear of their debt. Negotiations can start as low as 10% of the total amount owed but most times the creditor is going to hold out for an average of 75% of the balance. This can amount to quite a savings on the debtors part when dealing with larger dollar amounts. Hospital bills and credit cards balances are the most common debts for settlement as well as short-term payday loans.

Debt settlement is great for people who have the money to payoff their creditor or lender. Unfortunately, many individuals do not have the cash on hand to settle large debts. That is generally the primary condition of debt settlement. If creditors are going to lower the amount a person owes them, it's under the stipulation that the amount will get paid right away. Not only will the consumer have their debt paid, they can work on rebuilding their credit for the future.

Payday loan lenders work with borrowers when their loan is in default. In many cases it is advantageous for the lender to take a lesser amount for the sake of getting some of their money back versus getting nothing because the borrower can't make payments. Short-term lenders usually do their own collections and will work with a borrower directly to determine a debt settlement amount. If a third-party collector gets involved, a borrower's credit may be affected.

Regardless of the source of the debt, it is possible to escape the financial and emotional turmoil caused by collection activities. From having wages garnished to losing a home, dealing with smothering debt can cause individuals unnecessary amounts of stress. Fortunately, it is possible to negotiate a settlement with creditors and debt collection agencies. This can allow the individual to only pay off a portion of their outstanding debt. However, the catch is that this amount must be paid in full. US payday title and installment loans are meant to be short-term and for temporary financial uses. They are meant to be paid with the borrower's next paycheck; not to become long-term debt.

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Success Coach, Business Development Consultant, Strategist, Blogger, Traveller, Motivational Writer & Speaker