If you default on an unsecured debt, you won't lose anything (except points on your credit score).

If you default on an unsecured debt, you won't lose anything (except points on your credit score).

After explaining why you're in trouble, ask the creditor if the company would be willing to accept a smaller amount. Start negotiations at about 30% of the total amount due, with the end goal of paying 50%.

You can have a do-over starting today. But you have to get over the feeling that it's too late

If you are, consolidating at a lower interest rate can help you pay off your debt faster. But if there's even a small chance that you'll spiral back into debt, it's not for you.

Once the settlement is completed, the credit card company will report it to the credit bureaus, which will then make a notation on your credit report that that account was paid by settlement. That's going to signal to future lenders that you left the last guy hanging. That's why, as with bankruptcy, debt settlement is an extreme option, one you shouldn't take lightly. It's not just an easy, cheap way to eliminate debt.

One thing I want to make clear: You never want to hide from your debts. It doesn't work.