What Kind of Debt Qualifies for Debt Settlement in Arizona?

If you are like the majority of Americans, chances are you are carrying a significant amount of debt. According to a recent study conducted by Northwestern Mutual, the average person carries about $29,800 of personal debt. Considering the average income is $61,000, this is a shocking amount of debt for an average person to carry. Personal debt can be quite a burden on your stability, happiness, and even your health. Many people in the Northwestern Study reported feeling physically ill when they think about the debt they owe— a feeling no one should have to endure. Many people are turning to debt settlement options to find relief from the burden of their debts and gain financial freedom. Continue reading to learn more about debt settlement and what kind of debt qualifies for debt settlement in Arizona.

What is Debt Settlement?

Debt settlement is a debt relief option in Arizona for anyone who is struggling to meet their monthly debt payments. It is an alternative to bankruptcy and can help anyone who dreams of being debt-free. At UmbrellaDEBT, we will work closely with you to fully understand your financial situation. We aim to help you understand what options you have for reducing your debt and create a repayment plan that works with your budget and goals. So how does debt settlement work?

1. Financial Review

First, one of our experienced debt specialists will ask you some questions to fully understand your situation. They may ask you about the types of debt you owe, such as credit card debt or medical bills, how much your payments are, and if you are experiencing any unexpected financial hardships, such as the loss of a job.

2. Discuss Your Options

Once we understand your situation, we’ll discuss the options you have. No two situations are the same, so your options will be specific to you.

3. Negotiate With Creditors

If the options available to you seem like a good fit for you and you enroll into a debt relief program, we will begin negotiations with your creditors. Our trained negotiators have experience negotiating the balance and terms of repaying your debt in a way that works for everyone.

4. Create a Plan that Works

After negotiations, we will put together a plan that will enable you to finally regain financial freedom. You will be able to repay your creditors without getting behind, filing for bankruptcy or taking out other loans.

What Kind of Debt Qualifies for Debt Settlement in Arizona?

Unfortunately, debt settlement is not an option for all types of debts. There are two types of debt: secured and unsecured. Debt Settlement in Arizona is only an option for most types of unsecured debts. Let’s review the difference between the two:

Secured Debt:

A secured debt is ‘secured’ by an asset such as a house or a car. It is considered secure because the lender can place a lien on the item if payments are not made, and eventually reclaim the item and sell it to recoup their money. Examples of secured debts are:

  • Car Loans
  • Home Mortgage

Unsecured Debt:

This is debt that does not have any collateral. Creditors do not have any item they can reclaim and sell to recoup their lost money if payments are not met. A few examples of unsecured debt that qualify for debt settlement include:

  • Credit card debt
  • Personal loans, such as from your bank 
  • Debt that has already been sent to collections
  • Medical bills
  • Bills you may be behind on such as utilities or phone bills in collections and are turned off

There are other types of unsecured debt that do not qualify for debt settlement such as student loans, or IRS tax debts.

Get Help with Debt Settlement in Arizona

Debt settlement can be an option for anyone who has found themselves in a difficult financial situation. It can help you reclaim financial freedom and finally live a life free from debt. If you find yourself feeling overwhelmed by the amount of debt you have or are unable to make your monthly payments, contact UmbrellaDEBT today.

Umbrella Debt Relief 1-844-389-6745
200 W. Palmetto Park Road Suite 200 Boca Raton FL 33432