Debt settlement in Maryland is a form of debt relief that allows you to settle your debts by paying a creditor less than the full amount owed or the full amount under different terms. Debt settlement is a service that is offered by third-party companies. However, you can do this on your own by contacting the creditor directly. It usually involves negotiating with the creditor to come to an agreement to make one large, single payment for less than the amount due. In exchange, you obtain partial debt forgiveness, and your account may be closed.
Occasionally, a creditor may permit a short-term installment payment of two or three settlement payments in lieu of one large payment. It is important to know that since you are not paying back the full amount, your credit score will suffer temporarily.
A creditor may be willing to settle your delinquent account by reaching an agreement with you. If the creditor does not, they will likely end up sending the case to a debt collector or a debt buying firm or hiring an attorney to sue you and garnish your wages or bank accounts, all of which costs the creditor money.
There are some concerns with debt settlement. For one thing, the amount of any forgiven debt is considered income that the creditor is legally required to report to the IRS. That means you have tax obligations for that forgiven debt. Please discuss this with your tax professional to be sure but another issue is that your account may be in default before any agreement is reached. It will remain on your credit report and have a negative impact on your credit score. Settling for less than what is owed may also harm your credit score.
A Nager Law Group attorney in Columbia, Annapolis or Towson can review your situation and negotiate a debt settlement with your creditors. You may also be able to arrange for smaller payments to your creditors thereby reducing your debt load.
How Long Does A Debt Collector Have To Sue You In Maryland?
Debts must be collected within a specific period in Maryland. That period is known as the statute of limitations which is typically three years from when the date of the debt is due (with some exceptions) to make a request to the court ordering you to pay the debt. A court order to pay a debt is called a judgement.
If a creditor goes to court within the allotted timeframe and the court enters a judgment against you, the creditor has 12years to collect that debt from you. The creditor may renew the judgement typically, at any time during the 12 years after the judgment was issued filing a notice of renewal that allows the debt to remain enforceable for another 12 years.
If you are being sued by a debt collector in Maryland, an attorney at the Nager Law Group can help you. Our experienced counsel can negotiate with your creditors to try and resolve your debt issues.
For more information on Debt Settlement In The State Of Maryland, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (443) 492-9003 today.
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