There are some questions you need to answer before starting the program.
First, one of the most common is whether or not to keep a single card out of the program for everyday use or emergencies. We do recommend doing this but be sure to keep a card that has a low or no balance since you will have to make monthly payments on this account. Also, be sure that you have only a single account with that company. You would not want to keep a Chase card off the program if you have another Chase account you want to settle.
Creditors will ask you about this account during the settlement process because they can see your credit report and will know you have a current account. Tell them the truth that you keep this account for daily expenditures or emergencies.
Second, another point to consider is the history of the accounts you plan to settle. Accounts that are new are much harder to settle since that company has not made a profit off you yet. Recent cash advances or balance transfers can also complicate things. At a minimum, you should have made at least 3 payments on any account or following any cash advance or balance transfer before beginning this process.
Accounts with balances under $1,000 are another important consideration which we briefly touched on with the department and gas cards earlier. These accounts can be difficult to settle but paying them off in full can make larger creditors think you have enough cash to also pay them in full. We recommend paying them off in full if they are below $200. Otherwise, save them until the larger accounts have been handled.
Third and the most important part of the strategy is STOP USING THE ACCOUNTS ONCE YOU START THIS PROGRAM.
