Like most people, I’m sure you would like to pay all of your debts. You’ve been doing just that all of your life. But now life has thrown you a curve, and it isn’t possible to pay all of the bills on time anymore. Debt Consolidation seems like a good option. You pay one monthly payment to a debt consolation company and they contact your creditors and settle all the bills for you. The ads are everywhere: on TV, the radio, and the Internet. You don’t have to do anything. Great! What a relief. Problem solved. There’s only one catch: most, if not all, debt consolidation companies are scams. Their programs are designed to fail from the start, and they know it. The programs are also designed to make huge sums of money for the people who run them. The people who run these companies are slick salesmen who have a well rehearsed sales pitch designed to sign you up. They conveniently leave out the facts and the truth:
1. The high credit card interest rates don’t disappear just because you have hired a debt consolidation company. Your debts keep getting higher with penalties, interest charges, late fees, and collection fees.
2. These companies have no ability to stop the collection process. Collection calls, letters, and eventually lawsuits will persist. Some of the slick companies change your address and phone information with the creditors so the bills and calls come to them instead. They might present this as a service, but it isn’t. It is designed to keep you in the dark while you continue to send your money to them each month. While they are collecting your payments, they’re ignoring your creditors. Stacks of angry legal notices are being sent to you, only you never see them because your mail is now going to the debt settlement company. Calls from your creditors are being ignored. Eventually, the State Marshall will show up at your door with a summons announcing that you’re being sued. You call the debt settlement company and are finally told, “Oh, we aren’t lawyers.”
3. The premise of debt settlement is that you send X dollars per month to the debt settlement company. After they take out their hefty fee, they put the money into an account for you (if you’re lucky; some companies simply steal it), and when they have enough money on hand they call only one of your creditors and try to settle the debt for less than the full amount. As an example, if you are sending an extra $400.00 per month, beyond their fee, in ten months they will have $4,000.00 on hand. Perhaps that would be enough to settle one credit card bill, but by the time that happens you will be on the verge of lawsuits from all of your other creditors. Once a creditor sues, they will quickly get a judgment. A creditor with a judgment will immediately look to garnish your wages, attach your bank account, and put a lien on your house. IT IS SIMPLY IMPOSSIBLE TO PAY ANY DEBT SETTLEMENT PLAN FAST ENOUGH TO SATISFY ALL OF YOUR CREDITORS. THIS TYPE OF PLAN IS A SCAM.
4. The Federal Trade Commission, numerous State Attorney Generals and various consumer groups have warned consumers to avoid most if not all debt settlement companies.
Call Attorney Jefferson Hanna at 860-347-4741. He has helped thousands of people deal with debt problems. He has the knowledge and experience to help you make the right decisions to get you out of debt.