Comments on: Debt Reduction and Elimination Ads: The Real Scoop

By: Noel

Noel — Fri, 05 Feb 2010 15:10:49 +0000

We used the consumer credit counseling services in our area. It costs $2.00 per month. They negotiated lower interest rates for us, but not lower payments or balances, so it did not hurt our credit. We paid them once a month and they made the payments for us. They helped us create a budget and stick to it. We had a personal counselor that met with us as needed. This was through our county and it really helped. I would recommend it to anyone in a bad situation.

By: Personal Finance Student

Personal Finance Student — Fri, 05 Feb 2010 04:06:35 +0000

Okay, I really have no time about ads and the real scoop. Think about it. What if you perform some sort of service for someone for promise of future payment and don’t get a contract or other record of the transaction? How strong do you think your case for collection would be against them?

By: Brittany

Brittany — Fri, 05 Feb 2010 01:52:08 +0000

Serious doesn’t equal right.

And I really would like to see an Ethical Frugality debate on this. It’s an interesting issue.

By: Henry

Henry — Thu, 04 Feb 2010 23:36:39 +0000

My standards are as serious as this economy and my current financial situation. Thank you Diana.

By: Dizz

Dizz — Thu, 04 Feb 2010 21:14:37 +0000

Bankrupcy is for a clean start. Not to abuse the system.

Tip: If you miss a few payments, your credit card companies will ask you to join an interest free or low interest hardship program to pay off your debt. If you call them before you miss a few payments, they will not want to work with you at all. My interest rates were 10-20% but now I’m on a 0% program until my balance is paid in full.

By: Diana @ frontyardfoodie

Diana @ frontyardfoodie — Thu, 04 Feb 2010 17:21:12 +0000

Wow, Henry, you’ve got issues.

The point isn’t whether or not the credit card companies are ethical but that YOU are ethical. You know what you’re doing is wrong and because they’re doing something wrong doesn’t make that right.

You need to get some serious standards.

By: asrai

asrai — Thu, 04 Feb 2010 14:42:33 +0000

Henry that plan only works if you don’t owe the debt. If you do then own up and pay it off.

It sucks that the US doesn’t have help for debt repayment. In Canada there is a non-profit called Credit Counselling Canada. They BBB accredited and operate in every province.

By: Henry

Henry — Thu, 04 Feb 2010 08:46:01 +0000

And you think it is ethical for them to present a forged signature as evidence? Maybe he owed the debt, maybe he didn’t, but the debt collector still falsified documents and presented them to the court. That is blatantly unethical.

By: Henry

Henry — Thu, 04 Feb 2010 08:40:52 +0000

That’s their problem Brittany. They’re so money hungry they just expect you and everyone else to be stupid sheep. They think that when you get that registered letter or summons when they sue you that you’ll yell “Oh, lordy lordy, what will I do!” and then not even show up to court.
Think about it. What if you loan someone money? What if you perform some sort of service for someone for promise of future payment and don’t get a contract or other record of the transaction? How strong do you think your case for collection would be against them?
These credit card companies are faceless, unethical and supposedly professional. If they’re not professional enough to maintain records of outstanding claims, those userers deserve whatever they get.

By: Brittany

Brittany — Thu, 04 Feb 2010 03:24:04 +0000

Okay, I rescind my last comment defending you, Henry. Can we get an Ethical Frugality post on that gross abuse of the system, Trent?

By: Henry

Henry — Thu, 04 Feb 2010 01:17:37 +0000

I’ll tell you, I never got to file bankruptcy, but would’ve loved to. I found something a lot better. It’s worked over six times in the past year for me, family and friends. You have a credit card or other such debt. You’ve not paid it, it’s been through collections, sold a few times between various debt collectors. Finally, one of them sues you over it.
File an answer in court to their complaint, deny everything, demand proof of the debts. I learned that from Kevin Trudeau’s Debt Cures They Don’t Want You To Know About. The debts have been passed around so much none of them has any of the original paperwork, especailly with signatures to bring to court to prove anything.
One of the times they actually presented something with a ‘signature,’ but it was an obvious forgery because that person NEVER printed their name and address they always wrote it, so it was thrown out.
You don’t have to pay, and they stop hounding you, AND they have to remove it from your credit report. It is beautiful.
I know people that were being foreclosed upon, and fought the foreclosures because the companies lost the notes. They walked out of court owning their homes and walked away with tens of thousands, sometimes over a hundred thousand, absolutely free. So great. Who says you can’t get something for nothing?

By: Brittany

Brittany — Wed, 03 Feb 2010 23:11:28 +0000

I have a feeling the bankruptcy-cake-walk posts were tinged with a bit of scorn for how easy it is to slough off debt, not an intention to say: Hey! Bankruptcy is awesome! Go for it!

If I remember correctly, Trent has a good article or two explore the pluses, minuses, ethics of deciding to file for bankruptcy.

By: Diane

Diane — Wed, 03 Feb 2010 18:11:24 +0000

Let’s face it. Most things we do in life you do not need to hire help. You can exercise without a personal trainer, you can clean your house without a housekeeper, you can change the oil in your car without hiring a mechanic. However, not everyone can do it with free information only.

I truly believe that like #4jgonzales found out, you sometimes need someone to teach you the skills. Managing money is a skill. My business is very much like the person jgonzales describes. Sometimes someone might need the personal trainer before they can go on their own. And sometimes, you are better off paying for the personal trainer to keep you motivated.

#7henry/#8anna and others make bankruptcy sound like a cake walk. Yes, you can get credit easily for the next 7 years as #12kevin points out. But you will be paying for it a very long time. How so? Any credit you do get, you will be paying top dollar to get it. Interest rates on any loan or credit card will be the highest available.

By: Kevin

Kevin — Wed, 03 Feb 2010 14:00:29 +0000

An interesting irony about bankruptcy is that after declaring bankruptcy, it’s actually very easy to obtain credit again. The reason is because creditors know you cannot legally declare bankruptcy again for another 7 years, so they have a very high probability of getting their money from you. You have no escape routes left, so they’re not worried about getting shortchanged.

By: Maureen

Maureen — Wed, 03 Feb 2010 13:24:26 +0000

I definitely recommend Dave Ramsey and his books. I find the podcast inspirational, for some reason, but I am more liberal and disagree pretty significantly with his politics. But if you can manage to ignore that aspect, it can be inspiring.

We started our “debt snowball” as DR calls it and just this week paid off our last credit card bill. That’s a total of about $26k in 14 months. It’s crazy-fun to be paying cash for things that come up now – $690 for a new hot water heater? No problem. We have one more debt – a student loan – that is on track to be paid off in June. Then we’ll owe nothing but our house.

Living on CASH is good. The main thing about DR’s program is that it makes you aware, and then you get kind of crazy about finishing the process.

By: deRuiter

deRuiter — Wed, 03 Feb 2010 11:35:58 +0000

Anything you see advertised on TV you should not buy, as you are paying for the ads by buying a good or service which is advertised. Get the Dave Ramsey book and do it yourself for free!

By: deRuiter

deRuiter — Wed, 03 Feb 2010 11:34:04 +0000

I’m with David #9!!!! Debt reduction should cost you NOTHING EXTRA! 1. STOP SPENDING! 2. Borrow Dave Ramsey’s book from the library, and begin his baby steps, I think he calls it. 3. Sell everything you own except for mattresses, linens, basic clothes, tools and kitchen implements, sell everything else and apply the money to your debts. It will amaze you how little money that “stuff” for which you paid so much, is really worth. 4. Get extra work to earn extra money. 5. Rent out space in your home, rent out your garage (it’s empty now that you’ve sold all your clutter.) 6. Plant a vegetable garden and eat out of it. 7. Pay off the littlest debts first. 8. Do not spend anything, eat less, cook at home, work more, mend your clothing, put your money on your debts. 6. Our Federal and State governments are refusing to do this, and our country is about to go bankrupt, China and the rest of the world are not financially able to buy all of America’s mushrooming debt, there is too much of it. The American economy is about to tank because of this and the coming high taxes on EVERYONE. Get out of debt now because things are going to get worse. As for personal bankruptcy, as a landlord, don’t even bother to apply for one of my places. Bankruptcy means that you’ve cheated people like me out of our hard earned money, and that I am forced to pay more for goods and services to make up for you not paying your debts. If you were willing to go bankrupt once, you won’t flinch at not paying me. The more you do them, the easier things get, whether saving and paying off debt, or stiffing those to whom you owe money. Frequently debt isn’t a lack of money, it’s poor money management skills, profligate spending, and refusal to get out and earn extra. We’re not discussing that your cousin went bankrupt because of cancer, that’s an act of God. It’s different than bad money managment. SPEND LESS THAN YOU TAKE IN.

By: David/Yourfinances101

David/Yourfinances101 — Wed, 03 Feb 2010 10:57:30 +0000

I’d agree with the other commenters.

First, its not hard–mostly common sense and determination.

Second, what you do need you can find for free.

And third, yes, I am repeating myself, NEVER pay a dime for any of this.

The goal is to spend less money–not more

By: anna

anna — Wed, 03 Feb 2010 04:55:13 +0000

I agree with Henry. I had a roommate whose parents had declared bankruptcy 3 years before (2004) and they had 2 brand new vehicles Financed, a HUGE mortgage on their house and were obviously struggling to make payments with debt up to their eyeballs. I know all of this because my roommate came to me on more than one occasion asking for financial assistance since her parents provided NO support for her while we were in college because “they couldn’t afford to help their only child” while she worked 2 jobs & went to school full time. At 21 I couldn’t understand how ANYONE could declare bankruptcy once and turn around 3 years later with a ton of debt again, I now realize that they had a serious financial management problem but also companies should know better than to loan money to these people. People declare bankruptcy because its easy and they don’t learn so they continue to get into debt again.

By: C

Wed, 03 Feb 2010 03:36:39 +0000

some cc companies see this as a good thing, signing up for a counseling program, but some think otherwise.

my cc debt got out of control after college. i signed up for a consolidation program with a nonprofit organization that charges a low monthly fee ($8 bucks). sure, i get monthly newsletters on tips that i could have gotten off the internet. but they negotiated a very low finance charge – from 18% to 2%. i couldn’t have done this without help. the catch is that i may not use the credit cards while i was on the program. i completed the program and haven’t used the cards since. i’ve learned that i can live without them.

too bad that sometimes finding the right organization to sign up with could be a hit or miss.