Archive for October, 2009
Sometimes i get letters from credit card debt angencies saying i owe the same balance that i had for 6 years, but sometimes shows more balance with intrestest but only one letter said this, the rest all had same balances which were 6 years ago when i was in debt of £2,000, but one letter said £6,000, i have not replied or ever gotten back to the debt credit card collectors, agencies etc, so whats going on, does default mean no intrest charges?
Like I’ve already told you, you just wait until they finally catch up with you and you’re in for the surprise of your life! "Interest" won’t come into it ! ! !
What I am interested to know is if Debt Settlement really works and if you know of anyone who has been through it.
debt settlements are very different from Debt Consolidations.
Typically, you can do Debt Consolidation *BEFORE* you get into too much trouble with your creditors. It is a way of reducing your multiple monthly payments into a single lower payment. The objective is to get your monthly budget more manageable. debt consolidation only works though if you do not incur any new or additional debt after you complete the consolidation.
Debt Settlements are agreements (typicall entered into at some point after the debtor has defaulted on payment) with a creditor or the collection agency representing a creditor where the creditor agrees to accept an amount lower than the stated debt. While this seems like a good deal for the debtor, it has and can have many drawbacks.
Often the creditor and or collection agency have tacked on a significant sum to the original debt, so much so that even the discounted amount may be more than you originally owed at default. While it is legal for the creditor and/or collection agency to add interest, fees, and penalties, some of these additions can be quite high (in some cases they may even exceed the legal maximums). Further, if the agreement is to begin a payment schedule, the interest, fees and penalties may continue to accrue (often making it impossible for the debtor to ever pay off the debt). Don’t forget that the dollar amount of the "discount" must be reported as taxable income by the debtor.
If entering into a debt settlement agreement , be sure to have everything in writing and be more than sure you understand everything you are agreeing to.
While many debt collection agencies are honest and sincere in helping you resolve your debt problem, some are not and can make things much worse.
Be careful out there.
What I am interested to know is if Debt Settlement really works and if you know of anyone who has been through it.
Debt Settlements are very different from Debt Consolidations.
Typically, you can do Debt Consolidation *BEFORE* you get into too much trouble with your creditors. It is a way of reducing your multiple monthly payments into a single lower payment. The objective is to get your monthly budget more manageable. debt consolidation only works though if you do not incur any new or additional debt after you complete the consolidation.
debt settlements are agreements (typicall entered into at some point after the debtor has defaulted on payment) with a creditor or the collection agency representing a creditor where the creditor agrees to accept an amount lower than the stated debt. While this seems like a good deal for the debtor, it has and can have many drawbacks.
Often the creditor and or collection agency have tacked on a significant sum to the original debt, so much so that even the discounted amount may be more than you originally owed at default. While it is legal for the creditor and/or collection agency to add interest, fees, and penalties, some of these additions can be quite high (in some cases they may even exceed the legal maximums). Further, if the agreement is to begin a payment schedule, the interest, fees and penalties may continue to accrue (often making it impossible for the debtor to ever pay off the debt). Don’t forget that the dollar amount of the "discount" must be reported as taxable income by the debtor.
If entering into a debt settlement agreement , be sure to have everything in writing and be more than sure you understand everything you are agreeing to.
While many debt collection agencies are honest and sincere in helping you resolve your debt problem, some are not and can make things much worse.
Be careful out there.
I’m thinking about using a credit counseling agency or debt repayment plan but I’ve heard a lot of conflicting information about them in my research. Do you have any personal experience with it? Would you recommend it? Thanks.
I have personally used credit counseling services. When I was young and dumb (not saying you are, but I definitely was) I ran up a lot of credit I couldn’t pay off. Interest rates were killing me and late fees were adding to the balance every month. So I contacted a credit counseling service and frankly, they saved me from a horrible downward spiral.
Credit counselors are basically a go-between organization. They negotiate the interest rates down to a workable level and get late fees stopped. All in agreement that you will pay the current balance off over a 3 year period.
Positive
Interest and late fees stop racking up
Single fixed payment that is guaranteed to reach the credit company on time every month
One payment that is affordable – as opposed to all the small ones that come in at various times during the month and you can’t ever seem to pay on time (thus incurring another late fee)
Negative
You will have to cut up your credit cards. The accounts are canceled
The credit company might place your account in "collections" status during the payoff process. But once the account balance is zero they will list it as "canceled," which could mean anything to a future lender (you canceled it yourself, for instance, which isn’t a bad thing)
If you’re over your head in debt and the late fees are adding up a credit counseling service is a good way to go.
A lot of people say debt consolidation loans are good too. However to qualify for one you usually have to be at least $10,000 in debt.
If you want to know more about credit counseling, or need to contact an agency, you can visit my site here:
http://www.1-800badcredit.com/credit-card-debt-counseling.html
I started this site because I’ve been there myself. And there’s a lot of bad information out there.
Good luck to you! It’ll all come right in the end if you can stop the bleeding!
I’m thinking about using a credit counseling agency or debt repayment plan but I’ve heard a lot of conflicting information about them in my research. Do you have any personal experience with it? Would you recommend it? Thanks.
I have personally used credit counseling services. When I was young and dumb (not saying you are, but I definitely was) I ran up a lot of credit I couldn’t pay off. Interest rates were killing me and late fees were adding to the balance every month. So I contacted a credit counseling service and frankly, they saved me from a horrible downward spiral.
Credit counselors are basically a go-between organization. They negotiate the interest rates down to a workable level and get late fees stopped. All in agreement that you will pay the current balance off over a 3 year period.
Positive
Interest and late fees stop racking up
Single fixed payment that is guaranteed to reach the credit company on time every month
One payment that is affordable – as opposed to all the small ones that come in at various times during the month and you can’t ever seem to pay on time (thus incurring another late fee)
Negative
You will have to cut up your credit cards. The accounts are canceled
The credit company might place your account in "collections" status during the payoff process. But once the account balance is zero they will list it as "canceled," which could mean anything to a future lender (you canceled it yourself, for instance, which isn’t a bad thing)
If you’re over your head in debt and the late fees are adding up a credit counseling service is a good way to go.
A lot of people say debt consolidation loans are good too. However to qualify for one you usually have to be at least $10,000 in debt.
If you want to know more about credit counseling, or need to contact an agency, you can visit my site here:
http://www.1-800badcredit.com/credit-card-debt-counseling.html
I started this site because I’ve been there myself. And there’s a lot of bad information out there.
Good luck to you! It’ll all come right in the end if you can stop the bleeding!
I’ve heard that In charge solutions is a good company. I’ve heard that they are a non-profit organization.
We have a little over five thousand dollars in credit card debt and other misc. things.
We are only making two thousand dollars a month.
Any answers will be much appreciated!
consumer credit counseling services.
they are wonderful. we used them.
not for profit. dont go to anyone who wants to make money off of u.
i think the website is cccs.org
I’ve heard that In charge solutions is a good company. I’ve heard that they are a non-profit organization.
We have a little over five thousand dollars in credit card debt and other misc. things.
We are only making two thousand dollars a month.
Any answers will be much appreciated!
consumer credit counseling services.
they are wonderful. we used them.
not for profit. dont go to anyone who wants to make money off of u.
i think the website is cccs.org
Hi,
Ive just entered into a debt management plan today, which is goin to bring my repayments down to only £230 a month and have them cleared within 3yrs. But i still have a cashflow problem at the minute and am supoosed 2 b visting my brother in japan in the summer so i need 2buy a ticket for that. I have already been approved for a loan (earlier 2day before i spoke to the debt managemnt people) i just havent recieved the forms to sign for it yet. This is just a small loan which will help me ith my flight and cash flow, repayments £100 a month for 3yrs also. I can afford to pay both of these repayments per month.
My question is, now that ive entered the debt management will taking this loan null the debt management scheme.
thank for any advice
If you are entering into a Debt Management plan then there is normally a stipulation that you will not take out any more credit until such time as the debts are cleared. But if they don’t know…..
The only other problem you may have is if the Loan company spot the DM plan before giving you the loan.
Hi,
Ive just entered into a debt management plan today, which is goin to bring my repayments down to only £230 a month and have them cleared within 3yrs. But i still have a cashflow problem at the minute and am supoosed 2 b visting my brother in japan in the summer so i need 2buy a ticket for that. I have already been approved for a loan (earlier 2day before i spoke to the debt managemnt people) i just havent recieved the forms to sign for it yet. This is just a small loan which will help me ith my flight and cash flow, repayments £100 a month for 3yrs also. I can afford to pay both of these repayments per month.
My question is, now that ive entered the debt management will taking this loan null the debt management scheme.
thank for any advice
If you are entering into a debt management plan then there is normally a stipulation that you will not take out any more credit until such time as the debts are cleared. But if they don’t know…..
The only other problem you may have is if the Loan company spot the DM plan before giving you the loan.
Can you refer me to a good debt counseling company? I have heard there are a lot of rip off debt consolidation companies out there, and I am just looking for one that maybe you have had a good experience with. If you could give me some suggestions, that would be great! Thank you!
There ARE scams out there. I have used Consumer Credit Counseling Services and highly recommend them. It’s a program so you’ve got to be willing to work with them so they can work with you. It’s not going to be easy but will work to get you out of debt. The rip-offs are the plans that promise you all kinds of great things. Run, don’t walk, out of thier offices. Below is the link to the agency that governs legitimate counseling programs… start there for a referral: