N00b here: I'm Told That Debt Management is Not An Option for Me

Hi mrichter,

Welcome to the Community.

To qualify for a Debt Management program, you need to be on time with your payments.

I'd say that the sooner you put this whole mess behind you, the faster you can get on with your life. You usually have to have good credit to get a debt consolidation loan, unless you have equity. Since you have no equity in the house or car, you should be ok for bankruptcy. You should be able to qualify for Chapter 7, especially since you can't even afford a cell phone.

Good luck with everything!

chrys

Have you tried debt settlement program? It can help you to avoid bankruptcy. DS is able to decrease your debt by 50% or more. Give a thought to it.

Thanks for the suggestions, Chrys and "Guest".

The situation with these debts is that while I can afford to make a decent-sized SINGLE payment, I couldn't make the minimal payments to 5 or 6 different companies after the divorce, loss of income and lawyer. It left me choosing who to pay while also accruing "black marks" for late or missed payments and the subsequent increases in both the amount due and the interest rates. Definitely a no-win situation.

I am going to check into a Debt Settlement program -- and anyone with recommendations as to a reliable and trustworthy company, I'd appreciate the contact information. I've read so much about so many "scam artists" that it makes the ordeal even more frightening!

Bankruptcy is definitely going to need more checking-into as well. I'd just hate to have permanent damage done to my credit, if that's what the final outcome will be.

I'm going to continue to educate myself, and I'm so glad I came across this site. Thanks again, everyone.

Mel

debt settlement is a option but be sure you know the facts. It is a very useful tool as long as you know what is going to happen and what could happen. Stick around on the forum for a while and read up and know the facts and you wont be scammed.

There are very good legit companies out there, but no one will or should refer you to them because they are not allowed due to the forum rules.

use caution when taking advice from guests, alot of times they are companies using this forum for advertising.

keep this in mind when you decide if you decide to use a company. No company can promise you anything. This is a negotiation of debts they cant promise a time frame(they can set you up on a 2 year payment plan it maybe shorter, it may be longer) they cant promise a $ amount. Thats why its negotiation. They cant promise you wont be sued. If you pay in as much as possible and get it done as fast as possible you will lower your risk of getting sued. They can reduce the collection calls, but a few buttheads will still call, and threaten.

And one of these threats will be that they dont work with settlement companies. Trust me they do.

Know the facts and you will be fine!

Hi mel,

If you should go the settlement route, I would personally ask you to consider doing it yourself. The complaints against companies are pretty much the same across the board, but the worst thing I can say about them is that they are a total waste of money. They have managed to poison the minds of many people against bankruptcy, because it is to their gain.

Look, even if you get a really inexpensive company that only costs you $1000 (and that is impossibly cheap) it still COSTS you $1000, money that you could have put towards your debt. To put it another way, if someone paid *you* $1000 to help them, would you learn, and fast?

Debt settlement requires typing up a few letters, making a few strongly worded phone calls, some knowledge of the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA), and some strict and responsible budgeting in order to put aside a settlement fund. The settlement companies want you to think that you are unintelligent, that you are so high strung that you need them (for a handsome fee, of course) to help you.

This website has a LOT of info, sample letters, and personal stories of people empowering themselves. It is a valuable life lesson that will make you stronger as a person, and render you more able to combat the various slings and arrows of fate. Also you can take some of that extra $1000 you now have, and take yourself out to a fancy dinner/show to reward yourself on your new debt free status.

Of course, it is obvious that the assistance of a company may be the way to go for some. If you really must go to a Debt Settlement company, here is some great advice you should read first. Check out this FTC page for other great info.

As far as the reaction to your credit report: settlement will report as delinquent, charge-off, and then "settled for less than full amount". It's much harder to get back on your feet. After a bankruptcy you will get all kinds of new credit offers, especially within the first year, that you can rebuild your credit very fast. My mother bought a house 3 years after she filed Chapter 7. I really do not think that would happen if she had chosen Debt Settlement.

Good luck,

chrys

If you want to go with a debt settlement company then you should consider the points mentioned in the following page: -

Best Debt Settlement Companies - How to choose the best out of the lot?

some of the things i can add to the above suggestions are these:

1. be sure that they themselves are handling your accounts, I have heard of some settlement companies using outside sources for some accounts it will be hard enough let alone have to track down were your accounts are.

2. how long have they been in business? you should choose a company that has a proven track record(they could be a scam that has just changed names for a clear record too)

3. can they do business in your residents? some states dont allow settlement companies to work there

4. they must have strong customer service... ask them who you would contact in thier office about your accounts if you had a question or the direct # to who to get in touch with

5. also ask them some tough questions that you know the answer to and see if they are honest. Like can I get sued? these are questions they dont like to answer but the answer should be yes. If they lie move on. If they lie from the get go how can you trust them with your accounts?


these suggestions and the ubove ones will get you started but dont stop there. Keep going till your comfortable i hope this helps you!!!

You all are amazing, and I can't tell you how finding this site - and getting such great information and assistance - has meant. I've gone from being terrified to having some hope that I can turn things around. I thought the emotional upheaval of a divorce was bad, but truly, the financial havoc it causes is a hundred times worse. However, now I know I have options, rights and the ability to repair the damage.

Thanks to all of you, and Chrys, you're a godsend. I am so appreciative of you all. :rose:

Once you know that there are options it does relieve some of the burden. The fact of being scared and not knowing were to go is very scary. I myself have been there and didnt find this site i was on my own. Lucky for me i did manage to find a solution that worked and worked well without it.

But know i know how much this community helps others and what a good asset it is. Thanks for the good feedback Im sure the whole community would thank you if they saw your post.

All of our accounts are with collection agencies and we were able to find a CCCS company that would work with them. Its called Money Management International if you a web search you will find them. They were very nice and helpful.