Debt Settlement Companies: Better than an Attorney?

If you have to settle debt, you may wonder if there are debt settlement companies better than an attorney or if you ought to hire a debt settlement attorney instead. While the answer of course may depend on the attorney and the debt settlement companies, in most situations, a debt settlement company is not better than an attorney.

Debt Settlement Companies: Better than an Attorney?

One of the major arguments why debt settlement companies are better than an attorney is the argument that debt settlement companies may have an established relationship with creditors. Debt settlement companies often help hundreds of people, if not thousands, to settle debt. Many of these people probably have the same creditors and, as such, the settlement companies may develop a relationship with the creditors.

However, the same can be said of an attorney. An experienced debt settlement attorney will likely know many of the people at different credit card companies. In fact, because debt settlement companies may experience turnover as they hire and fire new credit counselors, an experienced attorney may have more of a long and personal relationship with a credit card company than a credit counselor from a debt settlement company is.

Other Benefits of An Attorney

Debt settlement companies may promise you a lot of things, like settling debt for a fraction of the cost. You may also think that the debt settlement company will be cheaper than an attorney since you may have an idea that attorneys charge high hourly fees. However, there are several important things to consider about these facts.

First, debt settlement companies may not always be honest or scrupulous. While there is some regulation, there are plenty of for-profit debt consolidation companies out there that have hidden fees or that may not deliver on what they have promised. Attorneys, on the other hand, are held to a code of ethics by the American Bar Association and the state licensing board; if they do not act in the best interests of their client, if they act unethically or if they charge fees, they can lose their license to practice law or be sued for malpractice. As such, with an attorney, you know what you are getting... with a debt settlement company, you may not.

Second, an attorney has to go to law school and pass the Bar exam. This means a debt settlement attorney has experience, education and knowledge. When you go to a debt settlement company, even if that company has a good reputation, you don't necessarily know about the individual credit counselor you are working with. Your attorney can put his skills and experience and legal education to good use helping you, and can potentially negotiate a better settlement and save you more money than debt consolidation companies could.

Getting Help

If you need to settle debt, carefully consider whether debt consolidation companies are better than an attorney. In many cases, you will decide that hiring an experienced debt settlement attorney is your best bet.

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