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Where you come from in the United States will have an impact on your financial wellbeing. The cost of living tremendously varies from place to place. Additionally, the rules that govern the provision of credit services differ widely from one state to the next. Many factors contribute to financial overextension, and more often than not, populations from some states that are generally considered well-to-do or have booming economies find themselves with loads of unsustainable debt. For instance, Georgia has a high portion of its population depending on credit cards due to high personal consumption rates, poverty, and long daily commutes.

Socioeconomic Status, Poverty, and Unemployment in Georgia

Georgia has a population of 9.8 million. As of 2014, 18.3 percent of this population lived below the poverty line making Georgia one of the poorest states in the United States. Poverty rates vary across counties and cities. In Atlanta, Georgia’s largest city has the highest poverty rates. Since the city destroyed its housing projects in the 90s, the highest poverty rates are in Atlanta’s suburban neighborhoods since that’s the only place residents can find affordable housing. But there’s one problem, there are not enough jobs in these areas to sustain the inhabitants. People have to cover long distances to work, and if you don’t own a car, it’s just impossible. This is one of the reasons Atlanta residents rely heavily on their credit cards.

In Atlanta, the poverty rate is around 24 percent. Though many people consider Atlanta a wealthy economic powerhouse in the state, many households, especially minority families are struggling. They have a hard time gaining access to quality education and securing family supporting jobs. The unemployment rate among the city’s African-American population is 22%, almost twice as high Atlanta’s overall unemployment rate of 13%. This is the trend in many states across the peach state. However, anybody can find themselves in debt. Many residents of Atlanta and Georgia at large are stuck with high amounts of unsustainable debt. A significant part of this population is exploring debt relief options such as debt settlement to avoid bankruptcy.

Debt Settlement

The debt situation in Georgia is despite the fact that Georgia is among the states with lowest land prices in America. The average credit card debt in Georgia is $5,343, but there are big disparities when it comes to individual cities with Atlanta leading the pack with an average debt of $26,940 among its citizens. This debt, however, includes student loans, auto loans, credit card loans, and personal loans.

What is debt settlement?

The process of debt settlement involves a mutual agreement between the creditor and the debtor where the creditor accepts a one-time payment of an amount less than what is owed and forgives the remaining debt. Anyone with an unsustainable amount of unsecured debt can, individually or with the help of a debt settlement company, pursue this debt relief option. There are numerous debt settlement companies in Atlanta. Don’t be a victim of debt settlement scams. Before you settle for a debt settlement firm, check its accreditation with Better Business Bureau. You can use debt settlement to settle credit card debts, medical bills, rent, and other forms of unsecured personal loans.

The Debt Settlement Process

The goal of the debt settlement process is to convince the creditor to accept the lowest percentage of the amount of debt owed as possible. If you hire a debt settlement company, they will be negotiating on your behalf. Once you explain your situation to them, they will notify your creditors to direct all the communication relating to your debt to them. You will no longer be dealing with your creditors directly. If the creditors accept the proposed deal, say for you to pay 60 percent of the owed amount, you will be making your payments to the debt settlement company until the debt is cleared. Other debt settlement options in Atlanta include debt consolidation and credit counseling.

Benefits of Debt Settlement

One of the advantages of debt settlement is that it gives you an alternative to filing for bankruptcy. Filing for Chapter 13 bankruptcy could have devastating effects on your credit rating and will stay on your credit record for longer periods. In addition to this, debt settlement allows you to clear your debts in a short amount of time. The major downside to debt settlement is its adverse effects on your credit rating. These effects are not as severe as they would be if you filed for bankruptcy and they are reversible.

Debt Relief Laws and Regulations

In Georgia, Debt collection and debt relief are governed by the Fair Debt Collection Practices Act (FDCPA). Georgian residents are 100 percent protected by Georgia Wage Protection for two months. The charges for debt settlement cannot exceed 6 percent in the state of Georgia. Unless the creditor has tried to make contact with the debtor at home in good faith with no response, they are prohibited from emailing or calling the debtor at work.