Please help me become debtless

June 30th, 2008

Hello my name is Steve Bis and I have been helping consumers that are in debt with their unsecured credit card debts for a considerable amount of time and am aware of the negative consequences it has on someone’s life. When you have credit card debt and think that this matter is no longer in your hands, you would be smart to make a choice on what to do and make it fast. You should not wait until it is too late. As the majority of you bye now already know is that the debt collectors are not very easy to deal with when you contact them with problems regarding you statement. It’s pretty interesting the way it works because when you initially obtain the card they are very polite people while you talk to them. Then if you call them to complain about a late or over limit charge and try to have it removed enough trying to keep up with 8% or even the 7.9 % interest that they are charging on your accounts. How are you suppose to deal with the higher payments now? It was cumbersome enough to manage before the interest skyrocketed. This is why many U.S. citizens are searching for other options such as credit card debt settlement vs. credit counseling, or bankruptcy. If you do not know much about these options then I will offer you a little bit of an education on them.

Consumer Bankruptcy

Prior to 2005 bankruptcy was to be used for consumers who were going through severe financial troubles. Regrettably it was mistreated by far too many debtors who were trying to avoid paying their debts. They did not want to take responsibility for their misgivings. The credit card companies were fed up with this so they petitioned to have the laws changed. It is now referred to as the Bankruptcy Abuse Prevention and Consumer Protection act of 2005. This would make it more difficult for many Americans to file for help. Bankruptcy should only be used as your very last choice after you have considered every alternative option. Also you should think of the consequences that might come back later on down the road. You would have to find a lawyer, go to court and that would run you a substantial amount of your hard earned income. There is also the matter of it being on your credit history anywhere from 7 to 10 years. When you sign any important application or document you will always have to say yes when inquired about your previous bankruptcy, so this does have a extremely long lasting effect on your credit.

Consumer Credit Counseling

Everywhere you turn, either on TV or the radio, you will hear about consumer credit counseling. A credit counseling firm will try to get the creditors to lower the interest on your credit accounts. You then make one monthly payment to the credit counseling firm and they then make your payments to each one of your creditors for you. The fallback to this choice is even though they lower the interest on your credit card balances you might still pay back as much as 125% of what you currently owe.

This is because joining this sort of program you will still be paying back what you owe plus some of the interest for around 4 to 7 years. Almost 50% of the individuals that are in these programs don’t finish the program for missing as much as one payment. Another downfall to credit counseling is that if you have a income problem and are miss your monthly payment they will kick you off of the program straight away. They will also raise your interest back up and the creditor could keep you off the program for at least one year and sometimes even longer. This will put you right back to where you started from, if not in a tougher situation.

Credit Card Debt Settlement

This is the avenue which can save you the greatest amount of money. A good credit card debt settlement company will save you at least 40% of what you actually owe. The 40% should include all the fees as well. Similar to credit counseling, you will hear a lot of TV and radio ads all the time. These companies are popping up all across America. Some of these companies try to make it sound like they have a magical bullet and are going to make all your debt disappear extremely easily.

There are even some companies that try to use religion to obtain the trust of consumers. Whichever organization you are going to use it is your responsibility to due diligence on them. You should start with the BBB (Better Business bureau). You should be able to find out a lot about a company from them. If you discover that a company has only been in business for a short time and has a slew of complaints against them, then you must stay away. One more thing to keep an eye out for is how long has the company been in business. Some companies only make it one or two years before they get shut down or get caught stealing people’s money. Then some of them only stay around to earn as much as possible and close down just to open up across townafternoon.