Do debt settlement companies have some “new information that credit card companies don’t want you to know”?
August 29, 2010 Leave a comment
No! They don’t have any secret information. They don’t have access to some new law and they are not working on your behalf. I believe that they are in fact working for the credit card companies. They are acting, in effect, as collection agents for the credit card companies and they collect your money to pay off these big banks which you owe money to.
What the don’t want you to know is that bankruptcy can discharge the full balance of all of your credit cards!
I don’t know if the debt settlement companies are owned and/or financed or controlled by the credit card companies or if the debt settlement companies are actually independent. All we hear are rumors of control. But it makes little difference to you as the debt settlement companies are operating as if they were collection agents for the credit card companies.
These debt settlement companies make good money settling your debts by charging you very high fees. They often want an up front fee, a percentage of what they save you, and you still have to pay off the credit card companies a portion of your original debt. Check out my earlier blogs to see how expensive this process can be.
Also you are not protected from a lawsuit if one of your credit card companies does not want to wait to get paid by this system. A credit card company can easily sue you when you are in a debt settlement situation and you will have no protection if they do. (If you are in bankruptcy they cannot sue you because of the automatic stay).
Remember though that there is no new information that these debt settlement companies have access to that credit card companies don’t want you to know. The credit card companies in fact want you to settle with them for less than the full balance if you cannot pay them in full. What they don’t want is for you to file bankruptcy and pay them nothing.
Bankruptcy is probably what you want and need though and information about bankruptcy is what the credit card companies really don’t want you to know.
I am a bankruptcy law practicing bankruptcy law in san diego. Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com. Or call me for a free consultation on debt or bankruptcy. Call now for a free credit report and analysis!
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