Debt settlement companies are accustomed to hearing how people aren’t getting true answers from banks, at least not complete truth.  Every good debt settlement company will help educate you about the way banks and lenders take advantage of everyday people by only partially informing them.

For example, if you are a young person, do you know that banks and credit card companies target you?  Students on college campuses and people who are under 25 are courted by banks because they don’t think about their purchasing choices over the long term.  More than 120 universities have cut deals with banks to issue student-ID cards that are also ATM and check cards.  Schools make millions of dollars from those deals.  In essence, colleges are offering up their students as sacrificial lambs to credit card companies.  No wonder people are in so much debt today, they’re taught from college that credit card debt is a good thing.  Debt settlement companies can help you grow out of the mistakes of your youth, and become financially free.

Courts may seem like a haven for those suffering under mountains of debt, but in all honesty the courts don’t care about your debt problems.  Since the late 1990’s, banks included arbitration agreements into their contracts, meaning you won’t be going to court if there’s a problem.  This means that rather than trying to sue banks over their activities, you will have to go through a private courts, which are heavily skewed towards corporations.  Debt settlement allows you to avoid such nightmarish scenarios and deal with your debt outright.

Also, did you know banks are charging extra fees for your overseas trips?  Your heavy credit card debt may be a result of a “once-in-a-lifetime” European vacation.  If you use a credit card to take money out of an ATM over in Europe, it may cost up to $7, plus any credit card fees on top of that.

Overall, credit card companies don’t tell you very much about their services.  Most of the unsecured debt that debt settlement companies help people with comes from credit card debt.  Part of this is that credit card companies don’t give you much information beforehand.  In spite of the pages of tiny text you get in the mail, credit card companies don’t disclose their inner workings.  In fact, during a 2007 investigation, The Government Accountability Office discovered that although banks are required by law to make fee information available to customers, one third of the banks investigated didn’t provide the required information.  Worse yet, more than half didn’t have any fee information on their Websites.

In the end, it’s important to remember that where you’re getting your information is important.  Debt settlement companies are on your side, and want to see you cut down as much of your debt as possible.  Debt problems can plague you for life, impacting your credit score, interest rates, jobs and more.  Contact a quality debt settlement company today to begin clearing out past debt and paving the way towards a successful financial future.



Thanks to Debt Settle Inc for contributing this article to our Bankruptcy blog:

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Many consumers swimming along happily in a sea of credit suddenly find themselves drowning in a quagmire of debt.  According to a 1992 Federal Reserve study, 43 percent of U.S. families spend more than they earn and, according to Cardweb.com, almost one out of every 100 American households will file for bankruptcy during their lifetime.

What should you do if you are one of these consumers?  You could take advantage of one of the many services available to you, such as debt settlement programs. You can have your financial freedom back again.

What Are Debt Settlement Programs?



For years, debt settlement has been a popular method for thousands of consumers to regain financial wellness.  Debt settlement means that, with the help of a settlement negotiator, you work out an agreement with creditors to settle your delinquent payments or unpaid balances.   

If you are behind on payments on a high interest loan, for example, it could take you as long as 20 years to pay your debt.  Debt settlement programs can help shrink your payment terms and amounts, and they can also provide you with the following benefits:

A Current Credit Report

When you sign up for, and begin, a debt settlement program, many creditors will “re-age” your account, or bring it to a current status.

Lowered Interest and Monthly Payments

Depending on your debt settlement program, your settlement negotiator can help reduce the interest payments and monthly payments on your outstanding loans.

A Reduction in Creditor Calls

Creditors call consumers regularly if they are behind on their payments or not making payments at all.  Negotiators can work with creditors to eliminate this practice once you are enrolled in a program.

In addition to these benefits, debt settlement programs can also assign you a credit counselor.  Besides playing an active role in your settlement, these counselors can also provide you with financial tools to teach you how to maintain a healthy spending practice.

What Types Of Debt Are Eligible?

While debt settlements can be performed on almost every type of debt, most settlement cases involve revolving credit, or credit cards.  Why?  It’s because credit card debt is one of the easiest and fastest types of debt to acquire. According to the Federal Reserve, Americans made $1.1 trillion worth of credit card purchases in 1999.  In addition, consumers in the U.S. carry on average $5,800 in credit card debt from month to month.  Based on this information, the Federal Reserve reports that if only the minimum monthly payment was made on this debt, it would take more than 30 years to pay it off.  This debt would also include an additional $15,000 in interest.  

However, remember that debt settlement programs are not just limited to credit cards.  There are many debt settlement programs available that can address your wide-ranging needs.

Are Debt Settlement Programs Right For You?

Debt settlement programs can be ideal for people with a good credit history who have been making consistent payments, no matter how small, on their debts.  If, however, your credit history shows that you are behind on your credit payments, or that you have significant “charge-offs” noted on your account history, you might not be able to participate in a debt settlement program.   

Unfortunately, many people don’t think about healing their debt problems until they decide to make a big purchase, like buy a new home.  Being proactive with your financial situation in advance and seeking advice from a credit counselor can help you get back on the financial well-being track before it’s too late.  

Here are a few tips to keep in mind as you enroll in your debt settlement program:

Outcomes Are Different For Everyone

Not everyone has the same experience in a debt settlement program.  For example, some people are fortunate to have their debt reduced down to 75 percent of their original payment, while others may only experience a 50 percent reduction.

Seek Negotiating Advice from a Debt Settlement Firm

 If haggling and hardball negotiation is not your thing, there are several debt settlement firms that can provide you with settlement expertise.

Be Patient

Even though debt settlement programs can put you on the fast track to debt freedom, in some cases, paying off creditors can still take up anywhere from two to four years.

Look forward to the future

Stay focused and remember that the right debt settlement plan can lift you out of the quagmire and have you plain sailing again in no time!



Thanks to John Chase for contributing this article to our Bankruptcy blog:

Information On Filing For Bankruptcy

Can you answer sitnhere2’s question about Bankruptcy?:

Are there any creditors that will not work with credit counseling service. I am concerned with my loan with Beneficial (HSBC) and CitiFianancial. Has anyone had issues with these and credit counseling programs?

Have you claimed your Genesis site?

Can you answer Janiced’s question about Bankruptcy?:

I know it’s time to hire a debt settlement company, since I don’t think I’ll be able to get out of my current situation by myself. (roughly $130,000 in debt… and counting). Are there any good debt settlement companies you would recommend?

Home Loan After Bankruptcy

Debt Settlement is a process in which a consumer eradicates his or her unpaid debts to his or her current creditors. Debt settlement serves as one alternative to filing bankruptcy. In debt settlement, usually an escrow, or trust, account is set up by the consumer who is facing a lot of debt. The consumer accumulates money in this escrow account every month in order to serve as proof that once a settlement on the debt has been agreed upon the consumer does indeed have the resources to begin making, and is capable of continuing to make, the payments in accordance with the agreement made. Many consumers chose to utilize a debt settlement company to settle their outstanding debts with creditors. Using a debt settlement company may be a wise decision for a consumer who is ready to get his or her finances in check but may not have the time to haggle and bargain with all of his or her current creditors. It is important to note however, that one should shop around for the best debt settlement company that suits one’s needs. Consumers should be wary of fraudulent debt settlement companies. Here are some things to look out for:

•Ridiculous Fees- Most debt settlement companies charge fees for their services. Consumers should be cautious of debt settlement companies that beat around the bush when asked exactly how much the debt settlement companies’ services cost. Before committing to a debt settlement company, consumers should ask for a break-down of their monthly payments; namely, consumers should find out how much of their monthly payments in the escrow account is going towards the companies’ fees and how much of their monthly payments in the escrow account is going towards actually settling the debt with creditors.

•Outrageous Claims- Some debt settlement companies make outlandish claims or promises to settle consumers’ debts for a few pennies on the dollar. However, the average debt settlement company typically settles for 20%-75% of what is actually owed. This range has a huge amount of variance. Furthermore, there is no way for a debt settlement company to know for sure how much a consumers’ creditors are willing to settle for. Therefore, it is important for consumer’s to ask for evidence to document the debt settlement companies’ claims.

•Decision Making- Some debt settlements companies have sales personnel who earn wages strictly from commission and therefore, are pushy and urgent in making consumers decide to utilize the debt settlement companies’ services. Debt settlement may not be right for everyone. Consumers should be certain that they can make the monthly payments. Furthermore, consumers should be aware that debt settlement laws vary by state. Most importantly, for-profit, companies that charge fees, debt management companies are not allowed to operate in the below 12 states:

-Arizona, Georgia, Hawaii, Louisiana, Maine, Mississippi, New Jersey, New Mexico, New York, North Dakota, West Virginia, and Wyoming.

It is important to remember that although debt settlement might worsen your credit in the short-term, the long term effects of debt settlement are to tackle your finances.

If you are serious about eliminating debt, Smith & Gromann, P.A., a reputable and experienced law firm, which is backed by the Better Business Bureau, may be able to assist you. Please call toll free 800-297-6752 or go to their website.

Additionally, once you have settled your debt and are eager to stay on track in improving your credit history, Smith & Gromann, P.A. may be able to assist inaccurate or outdated information on your credit report. Please call toll free 800-508-0041 or visit the website.



Thanks to The CreditLawGroup for contributing this article to our Bankruptcy blog:

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