Debt Consolidation and What Every Consumer Needs to Know
OF COURSE YOU NEED AND WANT DEBT RELIEF!
Are you…… behind on your mortgage payments, even facing foreclosure on your home?
Have you….. been bothered with creditors calling you at home? At work?
Have you… been having your wages garnished - or fear garnishment might happen soon?
Have you… lost your employment?
Did a lender… threaten to sue you?
Did your… credit card companies lower your credit limit and charge you late fees?
Were you told… a debt settlement company could reduce your debts for pennies on the dollar?
Have you… had checks bounce?
Has your… car been repossessed?
THERE ARE TWO THINGS YOU SHOULD KNOW:
One: Help is available!
Two: Some forms of debt relief can make matters worse!
As debt consolidation lawyers working for almost 25 years to get people out of debt, we understand:
why debtors like you might be tempted to snatch at any straw to get relief.
why you would try to avoid the "big, bad B word", namely bankruptcy.
why, with creditors breathing down your neck, you might turn for help to a credit counseling agency,
debt settlement company, or credit counseling service.
why time is of the essence when it comes to getting LEGAL advice.
(Government regulators and consumer advocates are warning citizens:
Beware certain kinds of debt relief!)
"Peddling relief, firms put debtors in deeper hole"…New York Times (July, 2010)
"Debt relief can cause headaches of its own" New York Times (Feb. 2008)
"Damned by debt consolidation: settlement could be a trap"…CBS Money Watch (Jan. 2010)
"Debt collectors on the offensive, clogging the courts"… Senior Life (Oct. 2010)
"Consumers' debts increase because of the interest and penalties, and they may end up being hounded by collectors, sued by their creditors, having their wages garnished and left with ruined credit ratings." (Linda Sherry, director, national priorities project at Consumer Action in San Francisco, 2010)
"You would be more likely to settle your debt by buying a lottery ticket than by signing up with a debt settlement company."…Illinois Attorney General Lisa Madigan (Mar. 2010)
Why are these warnings being issued? What are the problems with debt consolidation and debt settlement?
Debt settlement companies typically suggest that consumers make monthly savings payments into a special account held by the settlement company (or at a bank on behalf of the debt settlement company.) The consumer is advised to stop making payments to their credit card companies.
The money the consumers pays is left to accumulate in the account (minus up-front fees ranging from 14-20% of the amount owed) until there is enough to pay off half or more of the credit card bill. The settlement company promises to negotiate a cut-rate payoff with each lender once enough cash has accumulated to make a "deal".
Meanwhile, late fees and charges are accumulating on the credit card bills. (Remember, the creditors have not promised any settlement to anyone!)
Debt consolidation does not stop a creditor from suing you, getting a judgment, or going after a wage garnishment. You're making payments and fees are being taken out of those payments without any guarantee that there will ever be concessions made by your creditors.
A debt repayment plan program represents a big negative on your credit report, often bigger than bankruptcy itself! Sometimes the result is that credit cards can be turned off completely.
Some things you should know about Mark Zuckerberg and debt consolidation…
I never deal in absolutes, saying one solution fits all people who need debt help. I realize that most people simply don't understand how credit counseling or debt settlement companies really work, and why legal advice should be the first stop, not the last resort.
Bankruptcy attorneys in Indiana are first and foremost debt counselors - it's what we do every day of the week.
The moment you come to the realization that your debt is out of hand, you need to seek legal advice. The earlier in the process you begin, the more options will be open to you.
If you're reading this page, it's more than likely your life has already taken a sharp turn for the worse. Either a serious illness occurred in the family, causing hospital and treatment bills that are simply beyond your capability to handle, or you or a breadwinner in your family got laid off from work. Perhaps there's an unexpected and expensive divorce going on. If you're like most of the people we see in our four Indiana bankruptcy law offices, it's been a combination of two or more of those things.
Counseling on how to manage a budget isn't really going to help at this point in time. - your bills are mounting every day.
An experienced bankruptcy attorney can offer counseling on managing money and budgeting, but no credit counseling service or debt settlement agency is allowed to offer legal advice.
Chapter 13 bankruptcy is the ultimate debt consolidation plan.
Chapter 13 bankruptcy is the ONLY definitive debt settlement plan.
In a Chapter 13 bankruptcy debt repayment plan, all the parties - you, the court, and your creditors - know exactly how long the plan is to last and how it will work.
Chapter 13 bankruptcy accomplishes what no debt settlement, debt counseling agency, or debt consolidation firm can.
Don't look everywhere before coming back to where you should have started!
Visit us for a no-cost, no-obligation assessment!
Call the Bankruptcy Law Offices of Mark S. Zuckerberg, P.C.
Call today for a FREE Debt Consultation.
Call toll free 1-800-779-3900.
