Credit And Debt Counseling

out of hand. I am now in the position of either having to file Bkrpt, which I qualify for, or pay my creditors through a credit counseling service. After a divorce, my home was sold (no equity), and at the time I was unemployed. I am now employed and renting a tiny house but hoping in the not real distant future to purchase one. I am trying to get my financial affairs in order, but the payments to these creditors are far more than I can afford without going through credit counseling. If I pay them through counseling, it will take several years to pay off my debts. If I file bankruptcy, it will remain on my file for 10 years, but I'll be able to buy a home, albeit with an astronomical interest rate.

Any advice?

well, sounds to me like you are well aware of your options, however, i'd shave about 3 years off that bnkrpt on your report. my husband filed many years ago...7 to be exact and it JUST came off his report.
i went through a program through a law office and it's DMB financial. i was in about $15,000 with credit card debt out of college. looking back, i probably should have just applied for a loan through the bank and paid them off and owed the bank, however, working with DMB has taught me alot and after 3 years, my program is almost done. we are waiting to settle the last account, which should happen in the next few months.

with DMB, they take power of attorney over your accounts....just the ones that you owe. so, the collection calls go to them...not you! then, they work out a workable monthly payment with you and that goes into a trust. then, once there's enough there to settle on a card, they settle and move onto the next account.
meanwhile, all this is happening and your credit is going WAAAAY down the toilet. HOWEVER, when you are done the program they fix all of your credit. so, your report is sparkling when you're finished. the only catch is that IF you get back into the hole while they are working with you, then they will stop all efforts and the contract will be void.
so, if they settle this accoutn and see that i got another card and ran that one up and it's bad on my report, then they wash their hands of me.

SO, it's been a GREAT experience learning how to manage my money and live credit card free.

my husband had some when we married and we are in the process of getting the last one paid off. very nice.

the best part...when we get all of our credit woes under control we will have freed up $500+/month! that's a nice car payment!!!

so, i would check out DMB OR see if your bank would approve a loan for you...at least then it's just one payment per month.

take care:)

2007-10-10 07:53:15 by liebchen2

www.CreditRepairPublishing.com CREDIT COUNSELING and DEBT CONSOLIDATION What you need to know before you sign up. "(NPR News, May 15, 2006 ...

I am just looking for a company that is dependable and trustworthy so that I can rebuild my credit and take care of prior bills. I have a family now and am looking to get a haouse in the near future so I need to get all of this taken care of immediatly any input on a reliable credit counseling company would be great thank you.

Have you tried out Prosper? I have a loan through them, and know lenders on there. They let you put up a 3 year personal loan and the lenders (regular folks not banks) bid on the rate to fund the loan. It works a bit like eBay but the lowest rates Lenders bid to fund your loan at is the rate you pay. Check it out: http://www.prosper.com/join/loan/lastsli ceofpizza

2008-03-08 14:07:31 by Dubb T

I see their ads all the time, offering to slash debt in half and such. While I applaud these services for what they are trying to do, somehow they have to make money, or they couldn't afford to run these ads. Where is the profit coming from.

Appreciate the answers in advance, thanks!

Usually they are paid by the creditors and debtors both. The creditors are happy to pay a fee to someone who will get their money for them rather than take a loss. The debtors are happy to reduce payments and get a structured program to repay several debts into one managable payment.

Everyone is happy with the arrangement. The relief companies are acting a middle men, getting profit they create themselves.

The key with this is that anyone can negotiate with creditors. They can do it themselves and avoid the fees, whether hidden or known. If they do this then they can apply the 'fee' money to the payments and possibly end up ahead of the game.

Good luck

2007-09-22 02:45:37 by tech_guy_towt

Price: $8.95 $8.95

Just had a major surgery and racked up some major credit card debt while being out of work. Just looking to see where I could start now that I am going back to work.

If you are able, take out a home equity loan. Pay off the credit card bills with the proceeds. Then pay off the home equity loan as quickly as possible. This is a win-win situation. You get the credit card bills paid off, plus the interest on the home equity loan is a tax deduction.

Or, you could line up the credit card bills by 1)interest rate, 2)highest amount owed to lowest amount owed, or 3)lowest amount owed to highest amount owed. Whatever way you line them up, start paying them off.
I preferred the lowest amount owed to the highest amount owed. I paid the most money to the lowest balance, then paid the remaining bills just above the minimum required. As the lowest bill was paid off, I then applied that same amount plus the minimum to the next highest bill. As that bill was paid off, I then applied that amount plus the minimum to the next bill, etc.
Now Susie Orman would disagree with this method, but I found great satisfaction in seeing the bills disappear more quickly than if I had paid off the highest interest rate bill (regardless of balance) or the highest balance bill first. Plus, I think when you have big bills hanging over your head, you need to see progress as quickly as possible. It really gives you a boost to see those bills drop off the face of the earth.

Good luck!

2007-05-05 12:40:50 by metro7

I Owe roughly $30k in credit card debt and I'm not sure which path to take.

Like mpb says, bankruptcy will mess with your life in unexpected ways. And they recently changed the regulations on it, so it's a lot tougher than it was just a few years ago.

It is in NO WAY at all an easy way out, if you file you'll probably regret it and wish that you had just tried to get counseling, learned how to control your spending, and paid it off the old fashioned way.

2007-08-21 14:36:48 by Big C