February 7, 2012

On the Importance of Validating Your Debts

People looking for ways to clean up their credit reports sometimes turn to credit repair services because they promise to dispute your bad credit and have it taken care of for you in no time.  What a lot of them don’t realize is that many of these services will simply take your money and dispute every negative account in your profile, in the hopes that one of them might fall off.

As you can imagine, this isn’t exactly the best way to go about improving your credit score.  Disputing every account on your credit report not only is a waste of time (unless the account you’re disputing is actually inaccurate), and in some cases can land you in a world of trouble.  If there’s a collection on your report, and you dispute the account information, you’ll not only have wasted time and money, but you could open yourself up to lawsuits by claiming an account isn’t your own.

So what’s the better method for cleaning up your credit history?  If you’ve got accounts and debts on your file that you don’t recognize, don’t dispute them – validate them with a debt validation letter.

Rather than claiming information about an account is inaccurate and refusing to take care of it, find out the creditor or collector’s contact information (usually listed in the report) and write them a letter requesting verification of the debt, and that the collector provide proof that you owe the money, and that they have the right to collect it.  If the collection agency is unable to verify the debt, problem solved.  If they are able to verify it, your next course of action should be to set up some type of payment plan to get rid of the debt (and put an end to those annoying phone calls).

Remember that debt validation letters are only a means of verifying an existing debt, not a way to eliminate the debt entirely.  You shouldn’t try to validate a debt that you know for a fact is yours, as it could land you in deeper trouble with collectors.

How to Pay Off a Debt

The other day, I made my bi-monthly trek down to my mailbox to collect my mail, and was more than a little bummed to find that most of the mail that wasn’t a Penny Saver or flyer offering to buy my unused gold was composed entirely of bills.

Yeah, I know, welcome to the club.  This is certainly nothing new for me; but having so many unpaid debts piling up all around you (in my case, medical bills, car insurance, credit card bills, and more) can be more than a little daunting when the debt collectors come demanding payment NOW.

So what are some of your best options for taking care of your mountains of unpaid debt?  Take a few tips from the leader in San Diego credit repair services for the best way to find debt relief:

Pay it yourself

If you’re feeling up to tackling the giant all on your own, you can certainly do so.  Gather up all the necessary paperwork for the bills and work on a payment plan tailored for each outstanding debt you have.  Don’t be afraid to call your creditors to try and work out a payment schedule that works for the both of you.  Most creditors can be pretty accommodating – especially these days, with so many people facing financial troubles.

Hire a debt settlement firm

If the very thought of even looking at your bills causes you to involuntarily shudder in disgust, consider contacting a debt settlement firm to help you set up payment arrangements with your creditors and lenders.  Our own service is quite skilled at settling unpaid debts for as low as 50 cents on the dollar, as well as successfully setting up agreements such as pay for deletions.

If you’ve already fallen behind on your debt payments, and want to learn how to get back on track, give one of our specialists a call to find out how you can get your finances back on track and under your control.

Credit Repair Tips: Dealing With Medical Bills

Before we get into the topic at hand, I have a story to tell that actually ties into said topic; so if the four or five people who may read this will indulge me for a moment…

A couple of weeks ago, I drove over to my parents’ house for dinner.  My mom had sent me a text message early on in the day stating that she’d be making fajitas, and since my only alternative for dinner that night was a couple of hot sauce packets from Taco Bell that I’d stumbled upon in a kitchen drawer, so my decision was clear.

Five o’ clock rolls around, and I’m pretty much starving.  I make a mad dash for my car and tear down the freeway like a madman on a mission (I like to think that if I’d been pulled over for speeding, all I’d have had to do was mention I was on my way to Fajita Central and I’d have gotten a police escort to my parents’ house).

By the time I get there, I’m ready to ravage a plate.  I load up a flour tortilla with chicken, steak, assorted greens and beans, and healthy heaping of hot sauce.  I sit down to begin appeasing my taste buds with the monstrosity I’ve created, take a pretty massive bite out of the beast….and immediately have trouble swallowing it.  I take a gulp of soda to help smooth the process out and, whoops THAT was a mistake, I think as I rush to the sink and heave some of it back up.

As some of you can imagine, things didn’t really get any better from there, as the food remain lodged in my throat and refused to go down or come up.  I’ll skip many of the gory details and cut to about 6 hours later, where I was waiting in the ER with my dad, holding a Princess and the Frog bucket to catch any wayward saliva that crept its way out of my mouth (swallowing it was completely out of the question).

Fast forward to today.  I’ve learned the value of chewing your food thoroughly before swallowing, and have started receiving medical bills in the mail for my visit.

Now that that’s all out of the way, let’s get to the point of this blog – namely, how to deal with medical bills before they deal with you.  Here are a few tips:

Don’t ignore it.

No one likes the thought of paying off medical bills, especially if you have no health insurance to help cover the outrageous costs, but pretending the bills got lost in the mail isn’t going to help matters much either.  Hospitals typically only care to try and collect on a bill for a few months before they send it off to collection agencies, and we all know you don’t want to deal with THAT hassle.

Make sure the procedure is covered by your insurance.

Medical bills make about as much sense as student loans; they can be pretty hard to navigate if you don’t know what you’re looking at.  Make sure to follow up with your insurance company and make sure all the right paperwork is in the right place.  No sense in having to pay more for a simple procedure because one hand didn’t talk to the other.

Make sure you set up payment arrangements.

Like I said earlier, medical bills are a lot like student loans in the sense that they can be pretty confusing, and can keep you paying for years to come if the bill is big enough – which they typically are.  Unless you plan on paying the bill off in one lump sum (you lucky SOB), you’ll want to go out of your way to contact both the doctor’s office and your insurance company to set up a workable payment plan.  Again, the last thing you want is a bunch of medical collections showing up on your credit report to drag down your credit score along with your spirits.

Want more advice on how to tackle outstanding debts and repair your credit?  Speak to a specialist at My Credit Group.

Be Wary of Credit Repair & Debt Settlement Promises

To consumers struggling to make ends meet, advertisements for credit repair or debt settlement may sound like the perfect solution to their financial woes. But in some cases, these services do little or nothing for consumers’ debt problems and instead sap their finances and leave them in need of bankruptcy protection.

Before you sign up for any service that promises to improve your credit, make sure you understand the potential risks involved in such offers.

Credit Repair Scams

Credit repair offers (which are often scams) generally advertise their ability to “wipe out negative information” on a credit report or provide a “quick and legal” way to improve your credit. But the truth is this:

  • You can remove negative information yourself…if it’s false: You don’t need to hire an outside company to remove mistakes from your credit report. Rather, visit annualcreditreport.com and request a free copy of your report. If you see any information that doesn’t belong, simply follow the site’s instructions for contesting the information and the responsible parties will take steps to remove it.
  • Only time can erase true negative information: On the other hand, if your credit report contains damaging information that is correct (e.g. that you’ve missed payments, defaulted on a loan, or something similar), only time (and positive credit behavior) will ease the information’s impact.
  • A blank credit report isn’t good news: Even if a credit repair company managed to erase all negative information from your credit report, having a blank credit report might be a disadvantage for you. Why? Because without any credit history at all, potential lenders are unable to make an assessment about whether or not to lend you money.

Debt Settlement (Scams)

Another commonly advertised financial service is debt settlement. While some debt settlers are legitimate and can be helpful to those in financial need, others are less scrupulous and simply take customers’ money without helping them much in exchange. Here’s the truth:

  • You can settle your own debts: If you’re struggling to keep up with or have fallen behind on some bills, your creditors may be willing to negotiate with you. Why? Because in many cases, creditors stand to make more money from settling a debt (say, for an amount less than the total owed or for a lowered interest rate) than from a customer’s bankruptcy filing.
  • You shouldn’t have to pay upfront fees: Recently passed rules from the FTC mandate that debt settlement firms cannot charge upfront fees for their services in most cases. Some debt settlers, it seems, were taking payments from customers but putting little or nothing toward actual creditor payments.
  • You have a legal obligation to pay your debts: Part of the agreement you have with any lender is that you will pay the bill for any debt you incur – that’s why you have to sign a contract before anyone will loan you money. If a debt settlement company suggests that you will face no legal repercussions from withholding payment from your creditors, be suspicious: in many cases, that’s simply not true.

Debt Consolidation, Debt Settlement Or Bankruptcy – Debt Relief in Phoenix, Arizona

By Kent Harper -

Debt consolidation loans are becoming increasingly popular in Arizona, including Phoenix and Scottsdale. As the consequences of the economic slowdown become apparent, overwhelming personal debt is a reality facing many. Debt settlement is increasingly gaining popularity. But what is the right choice for a given individual? The only true way to know is to read up on the options. Many will want to consult with several experts in different areas about their particular situation.

In addition to consulting with a Phoenix bankruptcy attorney, you may want to speak with a few other experts. A new breed of debt professional is the certified debt arbitrator. These experts are unique in their qualifications. They often have special relationships with creditors. They can quite possibly help you avoid bankruptcy. Since they are trusted by these creditors, they can negotiate in a way that is out of the question for most individuals. They are a good starting point for most people interested in really getting a handle on their personal debt.

In Arizona as well as the rest of the nation, debt settlement is very different from debt consolidation. The former may result in reduced overall balance, sometimes by as much as 60%. A consolidation loan is simply a wrapping up of all of your individual accounts into one monthly payment. There is no reduction in overall debt, as there is with debt settlement. Because of this, debt settlement is gaining popularity in Scottsdale, Phoenix and Arizona overall.

Many people are concerned with the after effects of debt settlement. There is the general perception that debt consolidation is better in this sense. Most are surprised to find that if their credit is already damaged, debt settlement is little more than a short-term, slight diminishing of credit worthiness. Again, if an individual’s credit is already being affected by overextended credit cards near their maximums, it shouldn’t make any difference. Your creditors will stop calling you, and, if you follow through, your credit will inevitably return to a good rating.

When you are looking into debt settlement, remember: not all debt settlement groups are the same. Since these types of businesses are unregulated by the government, they are not all scrupulous. Look for the most of the following in a debt settlement professional: a good rating with the better business bureau, chamber of commerce membership, no unreasonable fees and no upfront fees. Lastly, make sure that you feel like the person can communicate with you and actually address and understand your concerns.

Speaking with several professional, including a phoenix bankruptcy attorney, a debt settlement specialist and a debt consolidation loan officer, makes the most sense for many reasons. You can make the most informed decisions possible with the help of credit counseling and input of varied professionals.

More Debt help info:
http://www.attorneysphoenix.net/arizona-debt-consolidation-loan.html
http://www.attorneysphoenix.net/

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Debt Settlement Programs Vs Filing Bankruptcy – What’s Best For You

By Frank Bernard -

Of the various methods of debt relief, the two most popular methods are the methods of debt settlement and bankruptcy. Bankruptcy is however, not in use by the majority of the people. This is because, people have shifted to the more elegant and effective method of settlement. There still continues to be a debate between debt settlement programs vs. filing bankruptcy. Some still think that bankruptcy is the best of any relief method available in the market. But, let us find out the best method for you.

Debt settlement programs vs. filing bankruptcy:

  1. Settlement eliminates a minimum of 50% and a maximum of 70% of the dues that the consumer has. Bankruptcy on the other hand can eliminate 100% of the loans. On this ground people may think that bankruptcy is better than settlement.
  2. Bankruptcy leads to complete loss of credit score and the consumer loses his or her credibility. The consumer fails to get any new loans for 7 years to 10 years. This is not the case with settlement. The consumer becomes eligible for further loans when settlement deal is completed. There is no loss of credit score or credibility.
  3. The method of settlement is the fastest and takes a maximum of 3 years to complete. Bankruptcy on the other hand takes up to 7 years to complete.
  4. Settlement is the cheapest method even though the consumer needs to pay the creditor, the settlement firms and also taxes. Bankruptcy will cost a consumer around $200-400 every hour as attorney fee and this is what the consumer will require to pay till bankruptcy is completely filed and dues are completely wiped out.
  5. There are too many legal hassles in bankruptcy but in case of settlement, there are either very less or no legal hassles.

Keeping in mind the above mentioned facts, it can be said that debt settlement is the best method of debt relief for you.

With the new FTC laws recently passed, debt settlement is a legitimate alternative to filing bankruptcy. Creditors are ready to negotiate and now you won’t have to pay a fee unless your debts actually settle. Check out the following link to locate legitimate debt relief companies in your state for free help.

Debt Reduction Help

Or Call: 800-951-9280

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Choosing Between Debt Settlement and Bankruptcy

By David Milton Sandy

When life has dealt you a series of tough breaks and you owe more money than you think you’ll ever be able to pay back, then you might consider the two most severe options under the debt management umbrella, debt settlement or bankruptcy.

Bankruptcy’s not a singular option; however, there are two forms of bankruptcy. Chapter 7 liquidates all your eligible debts, immediately. However, chapter 13, requires you to undergo a 5 year payment plan and if you complete the plan then it will discharge any remaining eligible debt. This payment plan will be very tough; generally all your disposable income after a very stringent calculation will be paid into the plan. In some areas, only around 20% of Chapter 13′s will be successfully completed.

Chapter 7′s as expected from the above generally has a very high degree of satisfaction among participants who feel they benefited from the procedure. The expected result at the end of a chapter 13 will be that you hate your lawyer.

A chapter 13 can do something that neither a chapter 7 nor debt settlement plan can do. It can allow you to make up for a deficiency in an item secured by a loan such as your house or car. If you can pay a deficiency out of a chapter 13 and any equity beyond your bankruptcy exemptions within the 5 year plan then you can keep the property, though in many cases an outsized property led to the problems in the first place. If you own property outright above the exemptions you can use a variation of this to essentially buy the property back over the life of the 13.

So that’s the first step, if you have secured property you’d like to try to keep then you need to know what a Chapter 13 will look like and if it could enable you to achieve your desired ends in terms of keeping property. There are very few other really compelling reasons you’d want to do a Chapter 13.

That would be unless; of course you have to go through a Chapter 13 to get relief. Congress has decreed a means test forcing people above the median income for your state with some adjustments to undergo a Chapter 13 and barring the easy Chapter 7. This is out of some notion that people should pay back their debts if they make enough.

So if a 7′s out of the question or can’t achieve your goals in terms of keeping assets then you will need compare to the pros and cons of chapter 13 and debt settlement. Significant pros of bankruptcy include that it’s legally guaranteed, you can’t be sued while undergoing the process, and it’s extremely effective at stopping harassing phone calls. Debt settlement also has really large pros that should be considered in that it’s much more flexible, generally achieved in a shorter period of time, the payments tend to be smaller, and if you have extremely large paid off assets it might be your only shot at keeping them.

Both chapter 13 and debt settlement will at the end of the day be a tough road and anyone who completes either option should be congratulated.

It’s also possible that bankruptcy won’t be an option for some people. Bankruptcies have a substantial stigma attached. In that case, debt settlement might be your only valid option for reducing the effect of overuse of credit in your life.

Overall, though the only way to really decide would be to get a debt settlement plan and a bankruptcy chapter 13 and compare them side by side. You should be able to get plans from each provider and take the time to make a reasoned decision. Debt management has certain basic principles, but everyone’s situation is unique.

David Sandy is a Memphis Bankruptcy Lawyer who likes to write about debt management and debt recovery and formerly extensively practiced divorce law in Memphis, TN.

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Bankruptcy Alternatives – How To Avoid Bankruptcy With A Debt Settlement

By Samantha Cox -

Consumers often see bankruptcy as the only way out of their current financial situation. However, consumers do not like what bankruptcy feels like nor what bankruptcy does to their credit scores. With bankruptcy the consumer often looses everything including houses and cars. They often have money taken out of their paychecks. The effect on their credit score is horrible and stays for 10 years.

The consumer has three choices besides bankruptcy. The consumer can go through credit counseling, debt negotiation, and credit consolidation. This allows the consumer to feel empowered and avoid bankruptcy.

Debt counseling is for those consumers who are in the best shape. Credit consolidation is when all the credit card debt is combined together and there is one lower interest rate. The idea is that with less interest accruing on multiple cards, the payment will be smaller. All the debt will be paid back and no negative effect on the credit score will occur. The advantage to having a professional do the work is that you will end up with a lower interest rate meaning you will pay less money.

The second choice is for those consumers who are making at least the minimum payment. With debt consolidation the consumer hires a professional that helps the consumer lower their bills. They do this by combining all the debt and making one monthly payment usually with a lower interest rate. By having a professional do the negotiating the consumer wins with lower interest rates. The professional will also help the consumer plan a budget that they can live within.

In this choice, you usually have to pay only half of the money and over a period of three years. Under credit card debt settlement the consumer will be working with a company that helps negotiate the bills down where the consumer can handle the payment. Then the consumer will make one payment to that company. They will also help the consumer plan a budget that they can live with. For the consumer this option is very freeing. It also means that later when the consumer wants to buy a home or other large ticket item the consumer can get the loan. The consumer can usually settle their debt for 50 cents on the dollar.

So you can avoid bankruptcy through debt settlement. You can choose to do so today!

Debt settlement is a legitimate alternative to filing bankruptcy. Consumers can expect to eliminate around 50% of their unsecured debt with the help of a legitimate settlement program. With the new FTC laws recently passed in July 2010, debt settlement is a much less risky option. If they don’t settle your balance you don’t have to pay a dime.

Check out the following link for free help from a certified debt relief specialist:

Free Debt Advice

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Getting Out Of Credit Card Debt Fast – Bankruptcy Vs Debt Settlement

By Samantha Cox -

If you are unsure of choosing a legal way to get rid of your credit card debt quickly, this article can help you great deal. Let us talk about the two debt relief programs which have created hype in the market; bankruptcy which was a favorite program in the past and debt settlement which is getting popular, every passing day.

In every matter of life you choose a way which is legal and ethical, then why not in this case? Let’s find out which one is more ethical and legal; bankruptcy or debt settlement:

Bankruptcy is a state in which an individual or an organization legally declares its inability to recompense its debt to the creditors. It was a convenient way out of debt situation in the past as the debtor had to pay nothing; but not now, the new laws formulated and implemented by the American government, along with Federal Trade Commission, have made it harder than ever.

Financial settlement is a process in which a debtor negotiates with its creditor, through a debt settlement company in most of the cases, to reduce its pending debt and getting out of the debt situation quicker than paying the minimum monthly payment. Debt Settlement might be the most feasible option for most of the defaulters as it saves you the two most important things; time and money. Unlike bankruptcy, it does not involve all-embracing paper work or court prosecutions. This might be surprising, but true, that Debt Settlement process can reduce your debt from 50 to 70%.

The two most important things in business are time and money. Debt settlement simpler process can save the both while in bankruptcy you have to pay huge amount of fee to the bankruptcy attorneys and considerable amount of time is wasted in tiresome paperwork, never ending court proceedings and agonizing legal tests. Debt settlement has much better effects on your credit rating than bankruptcy, which means you can get more loans in the future.

If your debt is over 10,000 dollars, a settlement is undoubtedly the best way out of debt. It saves your time and money and you can live a graceful debt free life!

Debt settlement is a legitimate alternative to filing bankruptcy. Consumers can expect to eliminate around 50% of their unsecured debt with the help of a legitimate settlement program. With the new FTC laws recently passed in July 2010, debt settlement is a much less risky option. If they don’t settle your balance you don’t have to pay a dime.

Check out the following link for free help from a certified debt relief specialist: Free Debt Advice

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When To File For Bankruptcy

By Vince Armstrong -

If you are in debt and weighing your options, bankruptcy may be going through your mind. But when should someone file for bankruptcy?

If you are over $10k in debt you can get help with a debt settlement. If you have done a debt settlement and still cannot pay off any of your debt you may have to file for bankruptcy.

If you owe millions of dollars and your business has failed, you may have to file for bankruptcy.

If your car is about to be repossessed, your house is under foreclosure, and you owe money on credit cards and loans, you should look into filing for bankruptcy.

Filing for bankruptcy is the action to take when you’ve tried everything else and still can’t pay off your debt. It is being legally declared unable to pay your creditors.

Bankruptcy can stop repossession, foreclosure, and calls from bill collectors, but you will still have debt that has to be repaid. Some debts cannot be eliminated and a court decides which percentage of your debt you will have to pay.

You may get a fresh start, but you won’t be completely free from your mistakes. You will owe money and it will be difficult to repair the damage done to your credit. It is possible to eventually have good credit, but it may take years and years.

Always try credit counseling, debt settlement, or debt consolidation before filing for bankruptcy. Debt settlement can reduce the amount you owe just as bankruptcy can, but it doesn’t hurt your credit score.

With the state of the economy, many people are in debt. Getting out of debt is a long struggle, but it can be accomplished. If bankruptcy is the only option you have left, make sure you find a good lawyer to help you through the process.

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