We do NOT offer this type of program.

DEBT SETTLEMENT, DEBT REDUCTION,
DEBT NEGOTIATION AND DEBT ELIMINATION

A Debt Negotiation, Debt Settlement, Debt Elimination or Debt Reduction Program

• These are all basically the same program with different names attached.
• At first glance this program sounds like the perfect solution. I get a small monthly payment. I get out of debt in 12 to 36 months and I can settle my debt for pennies on the dollar.The problem is that most people entering into this plan do not understand the realities and possible consequence of debt settlement. Many of the companies offering debt settlement fail to tell prospective clients that only about 1% of people joining this type of program ever settle their debt. Most either get sued, cancel the program or both.
• Most companies offering debt settlement programs do not explain how this program will effect them both in the short and long term.
• Most of the time the fees are very high. Most debt settlement companies require 15 to 20% of your total outstanding debt. Most companies collect their fees first before any money accrues to be paid to your creditors. It is almost impossible to find out what the total fee amount really is.
• The next issue is that you are told to stop making payments to your creditors. That means all payments to your creditors stop while you are paying fees to the debt settlement company and then accumulating money to offer as a settlement . Many people do not understand the negative ramifications of this.
• Your debt is increasing the whole time you are waiting for a settlement to take place. Creditors continue to charge late fees, penalties, over the limit fees and default interest rates for anywhere from 4 to 6 months of non-payment which is the time the debt is usually charged off.
• You say Great ! It is charged off so I no longer owe the debt right ? WRONG this just means you have moved one step closer to being sued. Once accounts are charged off owners of that debt are now allowed to sue you by law. The collection process does NOT stop. The next step is you are served a summons by the collection agencies, you go to court and the judge issues a judgment against you. At this point there is no debt settlement you now have a judgment against you and the owner of that judgment can seize funds, garnish wages and whatever else the laws of your resident state allow for.
• Your credit report at this point will be in a horrible state. You will have late marks, charge offs, judgments, ect, ect.
• If you are one of the 1% that does happen to settle a debt it will say account settled on your credit report which will remain there for 7 years. You will also receive a 1099 form from the creditor the account was settled with which will then be added to your ordinary income tax wages for that year.
• The negatives of debt settlement OUT WAY the positives by a mile. It is our opinion that Debt Settlement is a scam.
• Debt Management is a much better choice. Your payments are typically lowered. You have one payment and interest rates are usually lowered to somewhere between 0% to 10% interest. These 2 factors help you get out of debt up to 75% faster than you normally would. You will also be building your credit while you get out of debt. You will not be defaulting on your debt. Creditors can not sue you unless you have defaulted on your debt. This is the program we can help you get enrolled with. Please read "How The Process Works" for details on how the debt management program works.
• If you can not afford the payment of the debt management program, you should then contact a bankruptcy attorney in your area for a consultation. Bankruptcy protects individuals from being sued by their creditors in most cases. Contact an attorney in your area for additional information on bankruptcy state laws.

ADDITIONAL FACTS

• Most of these companies have very bad ratings with the Better Business Bureau. Most are not members of the BBB. They will lie to you and tell you the reason they have a bad rating is because they will not pay the BBB to give them a good rating. That is a flat out lie. NO company pays the BBB for a good rating. Your rating is based mainly upon the complaints your receive from consumers.
• These programs are not loans. You are asked to send or agree to have cease and desist letters sent to your creditors. You may never receive notification prior to being served with a subpoena to go to court. That is due to the cease and desist letters that were sent to your creditors.
• Typically the first 4 to 6 payments made will go directly to the company you signed up with for their fees. The usual requested fee amount is 15% of your total debt amount. Some companies will tell you this amount is refundable if they do not settle the debt. The refund to you is based upon many conditions and terms written into the contract you sign. If you do not keep all the terms of the agreement you forfeit your refund. The contract is carefully written to insured that very few if any refunds are given. If the company goes out of business you will not get a refund.
• These companies may tell you that very few people are sued with their program. The truth is the majority of people who join these programs are sued. Ask the company to put it in writing that you will not be sued. They will not give you this statement in writing because they know the majority of their clients have been or will be sued.
• To read a list of companies that have been or currently are the subject of subpoena by various state attorney offices please scroll down this page.

Most people joining these types of programs will be:

• Be sued by their creditors especially if they have balances over $1,000.
• Get a judgment which can be renewed and enforced by the creditor for the rest of their lives. Not even bankruptcy can remove it in most states.
• Have their wages garnished.
• Have funds seized out of bank accounts and refunds.
• Get a charge off after 6 months of non-payment. This stays on the credit report for 7 years.

If you are one of the fortunate ones to have a debt settled, you will be issued a 1099-c which is the form issued by lenders to report a cancellation of debts in excess of $600 to the IRS. The form reports the amount that was forgiven in your settlement. An example would be if you had a debt of $4,000 and settled the debt for $2,000, the difference of $2,000 would be considered income to you and must be figured into your annual earnings to determine your tax liability.

Keep in mind joining this type of program DOES NOT stop your creditors from pursuing you legally even if you are joining a program through a "debt negotiation law firm". If you are served a summons to appear in court most debt negotiation law firms will not litigate your debt accounts on your behalf unless you pay them additional moneys to either defend you or file Bankruptcy on your behalf. They will tell you this service is included but you may soon find out it is not part of the deal. If you are sued and a judgment is obtained at that point there is no debt negotiation. You then owe the full judgment balance and could be subject to unannounced bank withdrawals and/or wage garnishment. Unfortunately at this point not even doing a Bankruptcy can stay the collection efforts of the judgment holder. Judgments can usually be renewed indefinitely. There is usually no time expiration on judgments granted. Judgments can be renewed by the judgment holder for as long as you live. (each state has different laws on judgment time limitations)

The new sales pitch these debt settlement companies are using is that you the client will not be sued because of binding agreements they will be making with your creditors. Have the settlement company put this claim in writing. You will never get this statement in writing because it is not true.

The average debt settlement company keeps your first 6 to 8 payments for their fees. At best after 10 months of payments you may have 2 to 3 months of payments saved which may not be enough money to settle a small account much less a large one. It will take you 1, 2 or even 3 years to save up enough money to offer a binding settlement agreement. You can rest assured your creditors will not wait 1 to 2 years for their money. Don't be fooled by this slick sales pitch.

They will also encourage you to sign up by giving you a money back guarantee.What kind of a guarantee are you really getting ? Are you guaranteed not to be sued by your creditors ? Are you guaranteed all of your money back including court costs and attorney fees if and when you are sued ? Are you guaranteed to have your credit repaired once it has been destroyed debt settlement company will guarantee you these items in writing. That should be a very large warning sign for you