Filing for bankruptcy: Some things to keep in mind
September 23, 2009
I’ve seen many, many advertisements on television and the internet lately regarding filing for bankruptcy. Most of the ads tend to overstate or understate the difficulty and possible drawbacks regarding filing for bankruptcy.
One ad I recently saw made bankruptcy sound like a walk in the park, like someone waves a magic wand and all of your troubles are over.
Bankruptcy is certainly not an easy option. It’s not the best option for everyone. (Remember that it will stay on your credit report for up to 10 years and make getting new credit very difficult.) However, there are some people who truly don’t have a better option. And, though it’s difficult, you can rebuild your credit over time.
The bankruptcy laws now require anyone considering filing for bankruptcy to attend what is called a “pre-filing bankruptcy counseling session.” This session is actually very beneficial. A certified counselor reviews your financial situation and gives you the information you need to decide if bankruptcy is really your best option. The counselor may be able to give you other options.
The important thing is to make sure to understand all of your options and not take any decision lightly. And please be very careful when working with any kind of a debt relief company. Make sure you work with a non-profit agency that is affiliated with the National Foundation for Credit Counseling and has a good record with the Better Business Bureau.
Beware of false promises from debt relief companies
September 17, 2009
I’ve become quite concerned with some of the advertisements I’ve seen recently for debt relief companies.
I have seen more and more places claiming that people have a “right” to settle their debt for 50 percent of what they owe. I’ve also seen quite a few ads somehow relating the government and the president to credit card debt relief.
Neither of these things are true.
No creditor has a legal obligation to accept less than the full amount that you owe them. Some companies are willing to consider a settlement offer, but many won’t. And those that will accept a settlement aren’t doing it because they are legally bound to do so.
As far as the government goes, there is nothing in place to help people pay off their credit card debt.
The new CARD Act that is partially in effect regulates the credit card companies in some areas, but it does not offer any financial help to individual borrowers to reduce their debt.
If you are struggling with credit card debt, there is reputable help available. The best place to start is with a credit counseling session. Advantage CCS has a team of certified credit counselors who can review your financial situation and offer practical suggestions to pay down your debt.
Please research any debt relief company before you sign any paperwork or hand over any money. Make sure you are working with a reputable, non-profit agency that has your best interests in mind. And be especially watchful of companies that make promises that are too good to be true, or simply false.
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