Settle Your Credit Card Debt with Your Creditors

Settling your outstanding, delinquent debts is the best thing you can do if you are in the market to buy a house.

The negative listing on your credit report is unfortunately what the creditors want you to keep since it gives them the legal right to recourse to collection.

Even if you delete a negative unpaid listing, that negative listing may still reappear when the creditor or collector sells the account, seeks a judgment, or turns over your account to collections.

A question often asked is this: "Can I just delete the negative listings on my credit report without paying the debt?"

The answer is both YES and NO.

Yes, you can have the negative debt listings deleted from your credit report even before paying your debt in full. However, did you know that such negative listings have a way of reappearing on the credit file, sooner or later?

There is a better alternative than running away from your financial obligations.

The BEST SOLUTION is this: you can create a true win-win situation by settling the debt with the creditor.

It is my experience that the average consumer settles a debt for about 75 cents on the dollar. It is also my experience that a professional negotiator will settle an average debt for about 60 cents on the dollar, including their fee. Thus, there is rarely a good reason trying to "settle" your debt on your own and run away from your obligations temporarily.

Creditors will not take you half as seriously as they will take your attorney or professional negotiator.

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. That's why it is in the best interest 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, if 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 may agree more readily to delete the negative listings than banks or credit card companies. But there are also times 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. Once you've written that settlement check, your advantage vanishes. 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 delete a negative listing upon settlement of the debt, if handled correctly. Do not expect a creditor to honor 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.

"House Lust" by Dan McGinn

"House Lust" is the name of a new book by Dan McGinn that gets your attention.

McGinn is referring to the enormous sizes of the new built houses, at least in America.

"In Sweden, Britain and Italy, new homes average under 1,000 square feet. By 2005, the average newly built U.S. home measured 2,434 square feet, and there were many that were double, triple or quadruple that," McGinn writes.

Robert Samuelson, reviewing the book for the Washington Post, wrote: "In 2000, Toll Brothers' most popular home was 3,200 square feet; by 2005, it had grown 50 percent, to 4,800 square feet. These "McMansions" often feature marble floors, sweeping staircases, vaulted ceilings, family rooms, studies, home entertainment centers and more bedrooms than people."

Now with the latest credit crunch, some of those McMansions have been on the market for quite a few months now. Buying them was fun. I'm not sure selling them would be as pleasant.

After all is said and done, it all boils down to one thing: it's a BUYER'S MARKET dear reader. So if you've been in the market for a while this might be the best of all possible markets to own the home of your dreams. And if you haven't got the finances, or think you don't, that's why I'm here. Give me a call and see if we can put together an affordable home-buying package for you.

Call me today at (603) 505-4291 for a confidential consultation.

A Good Time to Buy a Home

Hi there! This is Eric Holm, your guide to home buying in New Hampshire and Eastern Massachusetts.

Despite the collapse of the sub-prime mortgage market and the related market contraction did you know that this is still one of the best times to buy a home?

Why?

Because sellers had never been this motivated for a long time. Houses are waiting longer and longer on the market for lack of buyers at the original listing prices.

I'll be writing more about this and other topics related to buying your own home in New Hampshire and Eastern Massachusetts in the days ahead. Make sure check out this blog frequently.

Best regards. Eric.