Debt Elimination Companies

Is the credit card debt solutions companies on the up and up?

Is the credit card debt solutions companies on the up and up? I was checking on line about getting my credit card debt paid off. Is it a good idea in using a company to get out of credit card debt?

Public Comments

1. Many of these companies are rip-offs. That is not to say that there aren't any legitimate ones, but they may be rare. Generally the legitimate organizations are non-profits, NOT the ones that advertise heavily on TV, radio, billboards, the Internet, etc. (if the company offering the solution is making a profit, then it is profiting off the financial distress of others, probably NOT where you want your precious and scarce money to go). If the company is offering to settle your debts for less than the amount owed, you should be aware that you will owe income tax on any "forgiven" amount - something these debt settlement companies rarely mention. I.e., if you have $20,000 in income from employment this year, but your debt settlement company arranges to have you pay only $30,000 in settlement of $60,000 worth of debt, you will wind up owing income taxes on $50,000 of "income" at the end of the year - a serious tax hit for those with limited incomes, and a tax debt that will not be dischargeable in bankruptcy if you eventually decide that you must go that route.
2. Credit card debt is something many men and women struggle with and if you allow it to get out of control it will take up you and your daily life. Debt settlement works and works well. Debt Settlement negotiates down your entire amount owed, while the client saves up enough money to pay that lump sum settlement.These kinds of programs involve purposely ceasing payments to all your lenders in order to force your accounts into default to attempt settlements at a lower price. The monthly premiums you are making go towards establishing a settlement account in order to pay the firm’s charges. They helped me to save around 50% . Good luck paying off your debt and don't let it consume you. You should not waste your time using a debt management system via a not for profit consumer credit counseling corporation like CCC. They are a non profits owned or operated by the credit card companies and have a 95% fail rate. The creditors fully understand this and are attempting to pull each and every last bit out of you before you decide to go into default. CCC appears worse than a bankruptcies on a credit report, as it would be considered a precursor to bankruptcies.