There are many national
debt relief companies that offer bankruptcy alternative programs in Raleigh and
Cary. While it seems like a viable option for managing your debt, consumers
should be careful about selecting debt relief as the “easy way out.”
Debt relief programs
often make many claims about how they can help. Unfortunately, not all of these
are true.
Claim: Debt relief services have little or no
negative impact on your future credit and can remove negative information from
your credit report.
Truth: Debt settlement can have a long-term impact on your credit.
Creditors have a legal obligation to provide accurate information to the credit
reporting agencies, including your failure to make monthly payments or
settlement for less than the full amount.
Claim: Debt settlement firms say they can
negotiate with your creditors to reduce the amount you owe.
Truth: There is no guarantee that a creditor will accept partial
payment of a legitimate debt. Creditors are under no obligation to negotiate
how much a consumer owes and there is no guarantee of success.
Claim: Debt relief firms may ask you to send
money to them instead of your creditors, promising to hold the money in a
special fund to pay on your behalf.
Truth: Debt settlement companies may not be legitimate and
therefore, may not make those payments or return your money if the plan is
unsuccessful. If you stop making payments on a credit card, late fees and
interest will continue to be added. If the your plan is unsuccessful you
may face much larger sums than when you started.
Claim: Creditors will not sue you for money you
owe.
Truth: Creditors DO have the right to sue you to recover the money
you owe. In some cases you could lose property or be forced into bankruptcy
anyway.
The Federal Trade Commission
and many states have laws regulating debt settlement companies to help protect
consumers. But that doesn’t mean bad companies aren’t still out there. Here is
a checklist of warning signs. If a company does any of these, avoid using their
services:
o Charges fee before settling your debts
o Guarantees they can remove your unsecured debt
o Touts a “new government program” to bail out
personal credit card debt
o Promises that unsecured debts can be paid off
with pennies on the dollar
o Tells you to stop making payments to or
communicating with your creditors
o Tells you it can stop all debt collection calls
and lawsuits
o Claims that creditors never sue consumers for
non-payment of unsecured debt
o Promises that using their system will have no
negative impact on your credit report
o Claims that they can remove accurate negative
information from your credit report.
If you are not sure
about something, ask a Raleigh or Cary bankruptcy attorney for help.
While bankruptcy sounds
more scary, it’s often a better option to “easy” debt relief, as we mentioned
in a recent post, “Six Reasons Why Bankruptcy May Be Better Than National
Debt Relief Programs.”
The old saying is true:
if it sounds too good to be true, it probably is.
About The Law Office of
Dennis Jay Sargent Jr, PLLC
The Law Office of Dennis Jay Sargent Jr, PLLC is a Cary / Raleigh
based law practice primarily focusing on Chapter 7 & Chapter 13 bankruptcy. Their goal is
to provide individuals and families the peace of mind when dealing with
stressful and difficult decisions regarding their home and property. They
strive to put the client first, helping to guide them down the legal process
path. Caring and compassion is the cornerstone for which they base their
practice on. Free initial consultations are available as well as evenings
and some weekends when needed. Contact them at www.SargentLawNC.com or
call 919-654-4545 for more information.
The Law Office of Dennis
Jay Sargent Jr, PLLC is a debt relief agency, helping people in the Raleigh
metro area file for Chapter 7 or Chapter 13 bankruptcy relief under the United
States Bankruptcy Code. They are a proud member of the National Association of
Consumer Bankruptcy Attorneys and the American Bankruptcy Institute.
