If you have a lot of debt, you may need to negotiate new terms with your creditors in order to come to some sort of settlement. One way to manage your debt is to create a Debt Settlement Agreement, which lays out a payment schedule and can even reduce the amount of debt by up to 50%. Once you and your creditor agree on this contract, you'll start paying off your debt according to these new terms.

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Settling your debt with a Debt Settlement Agreement is often preferable to declaring bankruptcy, since bankruptcy stays on your credit history for up to ten years, can make it difficult to get loans or employment.  In addition, declaring bankruptcy doesn't release you from having to pay recent taxes, student loans, or child support.

Make sure your collector or lender agrees in writing to report the debt as "paid as agreed" or "satisfied in full" to the credit bureau, otherwise your credit score can be affected adversely. You can easily draw up a Debt Settlement Agreement on your own, but if you owe a very substantial amount of money, you may want to Find a Bankruptcy Lawyer.

If you're ready to create a Debt Settlement Agreement, complete RocketLawyer's easy online interview process now.

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Get started Ask a Lawyer a Question You'll hear back in one business day.