Archive for February, 2010
As far as I can tell "debt management programs" are really just friendly faces of creditors that aren’t interested in helping you as much as they are creditors. My wife was using one when we first married and they screwed everything up. It also destroyed my wifes credit for 7 years and charged her monthly to do it!
Are there any ones that are actually out for the little guy?
There are plenty of credit repair companies that have no affiliation with creditors. They are simple out for their own gain. CCCS is afiliated with creditors, but they are actualy decent. It’s some of the independent companies that you have to watch out for.
Credit repair companies charge large fees, which, if put toward debt repayment would improve your situation.
The three main tactics that they use are:
(1) sending letters to initiate disputes about errors on your report. You can do this for free.
(2) sending letters to initiate disputes about things that are derogatory, but are not errors. Some creditors will not verify the debt and this gets deleted. Good. Now the bad news. You can get tagged as initiating frivolous disputes, impairing your ability to fight real errors in the future. You can end up unable to borrow because you won’t have a credit score. A lender who requests a score will get a message back "Unable to process – too many lines in dispute". Try and borrow with no score.
(3) They have you route your money for bill payment through them. No creditor will negotiate if you are current, so the creditors stop paying on your good bills so they go into default and then negotiates a settlement at less than face value. This saves you a few dollars now, but makes you look like a chronic deadbeat to all lenders in the future.
Looking for some help here, thanks.
http://www.usdoj.gov/ust/eo/bapcpa/ccde/cc_approved.htm
gov approved credit counselors
What are the reason or factors of someone to get denied for debt consolidation. With all the bills, by doing the math it is clearly that money coming in, is not enough for the money coming out. I’m thinking of applying for debt consolidation, but what if they don’t accept it. I’m running out of options. Bankruptcy would be last on my list. Please I need help/ advice. Thank you.
I would be very surprised if a debt consolidator turned anyone down (unless they didn’t have a sufficient amount of debt). They are going to want to work the account and collect their fees, regardless of whether or not the final arrangements are able to be met by the debtor.
What they will probably try to do, though, is negotiate with the creditors to accept a smaller payment than the minimum, stop interest from building and late fees being added, so there is some hope of eventually getting it paid off. They will try to get your total monthly payment for all debts (and their fees) down to something your income can accommodate.
I am having doubt about the credit card debt of a person. My uncle passed away but he is having credit card debt. Who is responsible for that debt?
the money comes out of the estate.
http://www.estatesettler.com/What_are_executor_responsibilities_-4489.html
I see commercials all the time about debt settlement but is it just a scam? Has anyone ever used this type of program and if so, what were your results? Thanks!
It isn’t a scam. It is actually something you can do yourself. Bills that are in collections sometimes the collection agency will send an "offer letter" They usually deduct about 10% – 30% off the total bill if you pay the entire amount immediately.
Best to get it all in writing as they will call with an offer like this and only credit your account. They will then continue harassing you for the balance.
So if it isn’t in writing the answer is no.
Ok I have 8000 in collections. Way over 180 days past due. I am concerned with my future and my credit report, in making a decision to resolve my problem. What will I benefit more. Settling for less than owed with the collections agency? Or, going into a consumer credit counseling debt management program?
Not all of the credit services agencies are scams. I’m currently in a debt management program, through MMI/CCCS and I don’t regret it at all. My creditors are getting paid and I’m not getting harrassed by them at work and at home.
When I first enrolled earlier this year I had a total of roughly $17k in debt with several different creditors. I know I could have made arrangements with the creditors on my own. I chose not to because of work. I work 7-5 and don’t get home in time to call customer service. Couldn’t call from work because personal use of the company phone is grounds for immediate termination. If you must make a personal call you can only use your personal cell preferably from inside your car because they don’t want people hanging around outside the building talking on cell phones.
For credit counseling to set you up in a debt management program I think you need to be at least $10k in debt. You should be able to make a settlement arrangement with your creditor. Call to get it set up and then send them an agreement based on that conversation in writing.
a month as i know debt management isnt good for your credit file and score or is it better to let the credit card companies deal with it and do it their way
i owe 22000 i was out of work long term ill and have gone back but i am in arrears and i have 6 creditiors so any advice would be good
Well the TAKE THIS TRULY GOOD ADVICE NEVER SIGN UP TO A debt management PLAN!
I have a financial planning certificate here in the UK & the companies will just prolong the debt, add extra cost’s for there telephone calls, letters & add interest to what you owe.
Below you will find the link to a USA free citizen debt advice centres. They will help you draft letter to all your creditors, they will draft a letter showing your income & debt’s owed. Then they will make a reasonable offer for repayment over a time to suit your income. In most case’s they will also arrange an interest freeze on the same debt’s
DON’T FAIL FOR ANY CREDIT PLAN IT WILL JUST RUIN YOUR CREDIT SCORE. MY ADVICE WILL HELP YOU IMPROVE YOUR CREDIT SCORE! But don’t do nothing. Vist the link below & act now!
Best of luck:-)))
I am trying to cancel my current debt management plan, but I cannot find anything on their website that allows me to do this. Does anyone have any idea?
If there’s a phone number to call, you should try that.
how do they do that and can a person do that on thier own?
Consumer Credit Counseling is an alternative for consumers experiencing financial difficulties and unable to make their minimum payments. Consumer Credit Counseling organizations act as an intermediary between you and your creditors.
Credit counseling does not include any type of credit repairing. Anyway your score should also go up in the long run because most of these programs teach you fiscal tips that will help you develop healthy money management habits. You will hopefully learn to consistently make on-time payments as well as keep your credit balances down to a manageable level. All of this will push your credit score upward over time.
I recently purchased a home (3 months ago) and financed 100% of the home. At this point I do not have an equity in the home. I am currently looking for a way to consolidate some of my debt to lower my rate, lower my payment, and ultimately pay off the debt sooner. I have 1 car loan, 1 personal loan, and 5 credit/store cards that I would like to consolidate totaling about $16,600. My FICO score is currently 686, and I am on time every month with all of my bills. I have paid all bills on time (most of the time more than the minimum) for more than 3 years straight. My problem is that my Debt to Income ratio is probably too high for most lenders to consider me for a consolidation loan. What can I do to consolidate ALL of my debt? Any feedback would be appreciated.
debt consolidation loans are usually a rip-off, extending loans way out and you end up paying a lot more in interest, plus the loan origination fees increase the amount owed.
Instead:
Transfer credit card debt to lower interest rate cards, some will give you 0% for a transfer. Do this before deciding which one has the highest interest rate to pay off first.
Pay at least double the minimum monthly payment on the credit cards and car loan. This extra will go entirely towards the principal, and reduce the debt a lot faster.
Pay off the highest interest rate credit card (or loan) first.
It is also a good idea to pay extra principal on your house, to reduce the interest and increase the equity.
Sell the car and get a used one that costs less if you have to.
Destroy your credit cards and don’t use them again, instead get a credit/debit card that pays interest and cash back for any charges. So you make money when using it instead of pay money.