Digging Out of Debt Safely Without Debt Settlement Plans

Submitted by Jen Jones on Mon, 11/01/2010 - 12:42pm

Digging Out of Debt Safely Without Debt Settlement Plans

Our recent, and lingering, economic recession has left many average Americans wondering how to keep their heads above the proverbial financial water. In a recent (and timely) article from AOL’s DailyFinance entitled, “Mired in Debt? Here’s How to Dig Out Safely,” the financial resources site discusses just that: strategies for success when trying to dig yourself out of mountains of debt.

In it, we’re able to take a closer look at debt settlement firms, one option many average Americans are turning to in these tough economic times—and an option that is leaving many with second thoughts about using this service ever again.

“Americans are reeling from debt: Bankruptcy filings for 2010 through early September are running about 12% higher than the first eight months of last year, according to the National Bankruptcy Research Center. And that's creating a slew of firms offering debt relief, some of which can make things worse. In response, over the past decade, the Federal Trade Commission and state enforcers have brought more than 250 cases to stop deceptive and abusive practices by debt-relief providers that have targeted consumers in financial distress. On Sept. 27, the FTC's Telemarketing Sales Rules will take effect requiring these companies to make specific disclosures to consumers and prohibit them from making misrepresentations. The rules will be extended to cover calls consumers make to these firms in response to debt-relief ads. On Oct. 27, the FTC goes further still, banning the practice of taking advance fees to arrange settlements.”

While these new rules provide some measure of good news for the millions seeking safer debt help, many are finding these firms are still mired in the same old deceptive and disingenuous practices. In fact, DailyFinance paints a not-so-rosy picture of the debt settlement process. These firms make customers feel that the process will be simple and doable, at least for the first one to three months of the plan (during which the debt settlement company is paid their commission).  After the commission is paid, debt consultants could normally care less about whether their customers stick to the debt settlement program. In short, once the settlement scam is complete…you’re officially on your own.

And while not all debt settlement firms are in it only for the money, it’s admittedly tough to judge the good from the bad. William Caniano, who used to work with a debt-settlement company and discusses the practice, among others, in his book, The Art of Bullspit and The Casino Economy told DailyFinance,  "Unless asked specifically, the consultant will not reveal in clear language that the client's credit will be shot. Truthfully, most of the time people are better off filing bankruptcy. Their credit will recover sooner, and in many cases they will shed their entire debt."

So, if you are considering debt dissolution strategies due to mounting credit card balances or other monetary matters, it’s advised that you instead address your debt with a knowledgeable attorney and a proven solution to your current debt worries and woes: bankruptcy. Knowing a qualified bankruptcy attorney can also help you to conquer your creditors and face your financial fears, yielding the right kinds of support, information and insights—at a low cost. The bankruptcy experts at the Law Offices of John T. Orcutt offer a totally FREE debt consultation and now, more than ever, it’s time to take them up on their offer. Just call toll free to +1-919-646-2654, or during the off hours, you can make your own appointment right online at www.billsbills.com. Simply click on the yellow “FREE Consultation Now” button.

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