A debt negotiator is the consumer's representative to the creditors. After assessing the consumer's financial situation and after having all the information needed to see if the consumer fits in the debt settlement program, he then would contact the creditors to negotiate a favorable amount with the creditor.
Debt settlement companies that want to be seen as dependent and legitimate, have their debt negotiators certified by the IAPDA.
How does Debt Negotiation Work?
Debt negotiation is also known as debt settlement; and it's an attempt to get the creditors to agree to reduce the consumer's balance to more or less half, in exchange for a lump sum payment – which is to be considered as payment in full.
What is the Debt Settlement Process?
The consumer contacts the settlement company via the phone directory, an add, or via a website like Debt Free Destiny, wherein consumers would fill out a form.
The settlement company's customer service team typically picks up the inquiry from those forms and answers the consumer's initial questions. If it's determined, after assessing the consumer's financial situation that the consumer qualifies for the program, the consumer would then be assigned a debt negotiator
They then figure out how much the consumer can afford to pay, sets up a debt settlement account with a third-party payment processing company or requests the client to save money on own account, save some money, and then contacts the creditor
* Every month the client saves money according to the budget set forth by the settlement company. Once the desired amount is reached (to pay the creditors and debt settlement service fee) the debt negotiator then contacts the creditors to start the negotiations.
When an agreement is reached, the consumer will receive written notification stipulating the terms of the settlement. Money is debited from the consumer's account straight to the creditors (it's a bank to bank transaction) in accordance with that agreement.
Upon the clarification of the amount agreed upon, the debt is reported to the credit bureaus as "settled in full", and the consumer can request a statement releasing him or her from any obligation to pay.
* For multiple debt settlements or another transaction with the same payment processor, the consumer just continues the regular deposits, until the desired amount is again reached.