Debt Settlement Can Help Save Economy, Banks

Columbia, Maryland (PressExposure) March 26, 2009 -- Representatives from the National Financial Awareness Network said today that banks could help mitigate losses from hemorrhaging credit card operations by negotiating with struggling cardholders to reach mutually agreeable debt settlements.

The FDIC lists 17 bank failures since the beginning of 2009, compared to just 25 banks in all of 2008, and consumer bankruptcies are up 29 percent in February as compared to last year. Job losses reached 4.4 million since 2007 and the latest TransUnion Quarterly Credit Card Analysis revealed an 11 percent jump in credit card accounts that are at least 90 days late in payment.

"We're seeing worsening economic conditions from several angles," said John Janney, President of the National Financial Awareness Network. "All signs point to a growing need for banks and consumers to negotiate settlements that help both parties out of a tough financial situation."

Debt settlements are agreements between creditors and consumers to pay off an account for less than the balance owed. Typically, creditors agree to settlements when consumers have been unable to pay on their accounts for several months due to financial hardships, such as loss of income or medical emergencies. By cancelling part of a balance in exchange for a partial payoff of the account, banks recover funds that might have been lost if their customer ended up filing bankruptcy.

"Banks often lose an entire account when a customer files bankruptcy," said Maggie Beetz, Senior Financial Literacy Writer at NFAN. "Recovering a portion of a debt is better than recovering nothing, and settlements help consumers regain the freedom they need to become active participants in the economy."

Janney urges consumers to investigate companies offering to help them negotiate debt settlements to make sure the company can perform the services advertised. He also said that consumers can negotiate debt settlements on their own and mentioned that inexpensive do-it-yourself debt settlement kits are available online.

About National Financial Awareness Network

The National Financial Awareness Network is a Maryland-based personal finance publishing company that offers educational products and services, such as the popular Do-It-Yourself Debt Settlement Kit (http://www.diydebtsettlementkit.com), Debt Relief University ([http://www.debtreliefuniversity.com]), Help For Debtors online support forum and their How to Get Great Credit e-book. For more information, please visit the NFAN website at http://www.nfan.com

Press Release Source: http://PressExposure.com/PR/National_Financial_Awareness_Network.html

Press Release Submitted On: March 25, 2009 at 10:59 am
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