Need input on debt reduction/settlement options

[Grandma Goldie]

We are thinking about contacting a debt settlement company to get our credit card balances reduced and paid off. I was wondering if anyone has done this or knew of someone who has and the pros and cons.

 

[okiegirl1]

Dave Ramsey
just go read his site
daveramsey.com

 

[Wifezilla]

I was just thinking that...LOL

YES...another vote here for researching on Dave Ramsey's site first.

 

[NurseNettie]

Absolutely-- read Dave. And do NOT go to a debt settlement company. Your credit will be just like if you filed for bankruptcy-- also another do NOT do.

We are thinking about contacting a debt settlement company to get our credit card balances reduced and paid off. I was wondering if anyone has done this or knew of someone who has and the pros and cons.

 

[hwillm1977]

My parents did it...

They handed all their debts over to the Credit Counselling company, then paid the credit counselling company monthly and paid off all their debts within 4 years... 1 month after finishing the debt repayment they got a credit card, 1 month later they bought a car, and the now own a house... (they finished paying off their bad debts in June this year)

It worked for them, they needed to fix their credit and dad had a heart condition and was getting stressed by collectors calls... the credit counselling company told them it would be 2 years after they finished before they could get approved for things because their credit would be awful, but it wasn't.

I don't think it's for everyone, but it does work for some people... definitely research it a lot, and figure out what's best for you and your situation.

 

[FarmerChick]

Con is you are treated like you did fine bankruptcy for future credit etc.

Pro is you get it all squared away and some relief off your back.

BUT you can also take all your loans into a bank....see if you can consolidate into one payment and spread it out and handle it that way WITHOUT having to go to a debt settlement.

For me, I would search other avenues first to handle this problem. Last resort I would consider debt consolidation with those companies ONLY if I could not make it and had dire straits.......easy way out (in a way) but also researching all avenues before you do it is best.

good luck to you!!! we sure all have financial troubles in these crazy times. I know!

 

[lorihadams]

I did credit counseling years ago and it worked out great for me. I had 4 credit cards that I used to fund a business venture that folded and ended in a lawsuit. I ended up with about $27000 in debt and I was 25 yrs old. I did the credit counseling and was able to get the fees and penalties stopped and pay one payment . It took me 2 1/2 yrs to pay it off but it is done and my credit score is in the 700s now. That was almost 10 years ago and things have definitely changed so I would check out every avenue thoroughly first before you do anything. You may want to see about meeting with a financial advisor. Good luck! You can do it!

 

[On Our own]

Make sure you're going to a gov't backed non-profit credit counseling company - some of the others are huge scams. More people who belong in jail!

 

[noobiechickenlady]

Another vote for Dave!
As previous posters have mentioned, those places typically will affect your credit just as if you had filed bankrupcy.

Look into balance transfers, lump them all on a new card with 0% interest & don't charge any more on that card until it's paid off. Check out what Nifty did recently.

If you are already behind, Dave says to accept one call per month, hang up on ANYone who is a jerk & offer a cash payment in full for a lesser amount or a payment plan. Do not give anyone access to your account electronically. Get everything in writing. Any communication via snail mail should be sent certified mail, with delivery notification.

On anything you do, read the fine print. All of it. If it's in legalese, get the lawyer/financial advisor to explain it in laymans terms.

 

[Grandma Goldie]

Thanks to everyone for the input. I had forgotten that I had years ago purchased cds of Dave Ramsey's TMMO. I found them but have not been able to convince hubby that there is a way to make this work. He is just really tired of having nothing left over after the bills are paid and working 70 hrs/wk. I think the main problem is that he has been at the same job for 13 years and he needs a change. He goes to work around 12:30 pm and gets home anywhere from 1:00 am to 3:00 am. He is not a young as he used to be (but who is) and it just wears him out. If all the cc bills were paid off we could afford for him to take a job with less hours and less pay. We talked this morn and we both had the same nagging feeling that the debt settlement/reduction was maybe not the way to go. Keep us in your thoughts and prayers. I know that we will find a solution.