Let's get right to the point: Texas has some very favorable consumer protection laws that have been on the books for many decades. This allows Texas residents save more money and potentially get much lower settlements than other states. Knowing these laws are critical to delivering such great results for our clients at Integrity Debt Solutions. But what are the overall pros & cons to entering a debt settlement program?
What Are The Pros & Cons of Debt Settlement in Texas?
What Are The Benefits of Debt Settlement?
If you enroll into a debt settlement program, the potential benefits are these:
(1) You can stop your monthly credit card payments immediately;
(2) You can potentially reduce your total debt by 30% to 60%;
(3) The average time it takes to complete the debt relief program is 12-48 months depending on various individual factors like how much money you can save each month, can you borrow money from friends or family, can you borrow from your 401k, can you sell a large ticket item, or can you take a little money out of an IRA or retirement plan, etc;
(4) You can settle one account at a time as you're able to afford to settle;
(5) You avoid having to file bankruptcy which stays on your record for 10 years - that is, if you can qualify to file for bankruptcy. Many people make over the median income in their state which immediately disqualifies them from being allowed to file;
(6) You avoid paying monthly payments for the next 5-7 years in order to get out of debt which would amount to approximately 150% of your current total debt amount.
What Are The Drawbacks of Debt Settlement?
The potential drawbacks of debt settlement are as follows:
(1) Only unsecured loans & accounts are allowed. For example, you can include credit cards, personal loans, all unsecured accounts, business credit cards, business loans, car repossessions, and medical bills. Student loans, car loans, and mortgage loans are not allowed;
(2) Your credit score is negatively affected until you complete the program and settle all of your accounts and then work to rebuild your credit;
(3) There are potential tax implications on the amount you save. For example, if you settle a $5,000 credit card for $2,000 (or 40% of the balance), you will most likely receive a 1099 the following year for the amount saved ($3,000). Then you will have to claim this $3,000 as income and pay tax on it. If you are in the 22% tax bracket, you will owe $660 in tax;
(4) Not every creditor is guaranteed to work with you to accept a lower settlement amount. At Integrity Debt Solutions, we guarantee at least a 30% reduction of your total debt or you get our program for free. We are the ONLY company to offer such a broad guarantee.
Finding a Company That Specializes in Texas Can Help . . .
Integrity Debt Solutions is the only company that specializes in serving Texas consumers and we've been doing so since 2004. For 20 years we have been helping our clients implement little-known & extremely beneficial consumer protection law that is unique to Texas allowing consumers to save a great deal of money. We have also researched various federal and banking law surrounding the issue of credit card debt, debt settlement, and consumer rights bringing a great deal of confidence & success to our clients. Each state in the country has their own consumer protection laws, but there are federal & banking law that apply to everyone across the country. Texas has very powerful laws in place to help protect their residents as well as give them extra time to resolve their debts. In this case, what you don't know CAN hurt you and hurt you a great deal.
We are happy to offer you friendly & professional information so you can research if debt settlement is right for you and provide you with a Free Estimate. Simply call us today or complete the online form by clicking "Get a Quote" and we'd be more than happy to send you detailed information and answer your questions.