Debt...although a necessary evil in today's economy, it can be devastating.  Here are 4 Debt Control programs that may work for you!

Are you having a hard time with any of these?

• Credit Cards
• Medical bills
• Utility Bills
• Personal Bank Loans
• Auto Loans
• repossession Deficiencies
• Judgments

If you do (and millions of people are just like you), you should consider one (or more) of these programs:

DEBT ACCELERATOR PROGRAM

There are all kinds of estimates or studies that have been done to try and calculate how many people are carrying debt loads that are becoming difficult to handle.

The average US household credit card debt is estimated to by around $15,000.  Now, some families are carrying very large amounts of debt and some have less, but the point is... we (most people) are carrying far too much debt. 

I  believe it was Dave Ramsey who either first developed or made popular the idea of the Debt Snowball Plan.  Sure, there are some critics of this type of plan, but usually those critics have not been dealing with people (and especially people's emotions) for very long.  While I don't agree with everything he promotes, the fact that he is helping people get control of their debt is admirable, and I applaude his teachings.

Basically, in a DEBT ACCELERATOR PROGRAM (my term for a Roll-Up or Snowball Plan) you are going to be paying a little more that the total required minimum payments of all of your accounts. Don't think you can find a "little more" money each month?

• How about making a few changes in your lifestyle?  For example:
• Daily StarBucks coffee = $5.00 x 30 days/month = $150 per month
• Fast food lunch at say $6 bucks x 30 days/month = $180 per month
• Health club membership you never (or rarely) use = $25/month

Get the idea??? If you are serious about finding some extra money to pay off your debt in a shorter period of time, you can do it!  OK, I'll get down from my "soap-box"! 

Let's say you have a total monthly minimum required payment of $500.  Although you have been paying consistently for several years, the balances are barely going down!

Of course, you know (or should know) why.  The credit card industry has tricked the average consumer into thinking that they are "repaying" their debt by making the minimum required payment each mont.  But, if you will take a close look at your next credit card statement, you're going to be shocked (outraged is better) to learn that your balance was hardly reduced at all.  Here's why:

Hypothetical Credit Card:

• Balance                                    $7,000
• APR                                             19%
• Minimum Payment is 2.25% of balance

$7,000 x 2.5% = $175

19% / 12 (months in a year) = 1.583% interest on $7,000 = $110.81 (THAT'S RIGHT...DO THE MATH)

So, when you send in your "minimum payment" of $175, here's what next month's statement will look like:

Previous Balance                      $7,000.00

Interest charge                         $  110.81

Payment received                    -$   175.00

New Balance                            $6,935.81

YOU GOT IT!  You sent $175 and your balance was only reduced by $ 64.81!!!

No wonder it takes peope 10, 15 or more years to pay off the average credit card (especially if you continue to only make the "minimum payment required"!

But, by making a few changes in your spending habits, you find an extra $100 per month.  By adding an additional $100 per month to the $175 (and not reducing the $175 as you balance goes down), you can pay off that credit card in just 33 months, saving you thousands in interest!

Now that you have that one paid off, YOU DON'T LOWER THE TOTAL MONTHLY PAYMENT, you just reallocate or add it to the next credit card, and so forth, and so forth until all of your credit cards are paid off!  DOESN'T THAT SOUND GREAT!

But, what if you not only can't afford the total minimum payments, you don't have any extra funds for a Debt Accelerator Program?

Then, a DEBT SETTLEMENT PROGRAM may be the answer!

So many people have run into some very difficult times, financially.  This may due to:

• Loss of employment
• Too little fixed income after retirement
• Death of a spouse or partner
• Disability
• Divorce
• And many other "financial challenges" that you may be facing

Does that mean that you can never recover or be DEBT FREE once again?

No, in fact, debt collectors are usually more than willing to SETTLE a debt for less than the total balance, depending on your particular circumstances.

When you fall behind on your payments to your creditors, as you know, the calls start becoming more frequent and frustrating! 

Did you know that once your account has been transferred to a debt collector, you can legally make them stop calling?

After you account is with a debt collector (may be a "debt purchaser"), you will need to make a SETTLEMENT OFFER of much less than the total balance.  Now, here's where it get's tricky.

A professional debt collector usually receives a bonus or commission depending on how much they can get you to pay.  In some cases, they start out very firm and tell you that they cannot offer a discount at all (not true).  Sometimes, they are willing to offer 70% or so, and you may have received a letter with the offer.

My experience with dealing with debt collectors over the last 12 years is that they are all working on different "numbers" (for lack of a better word), meaning that they have certain goals their bosses give them and they may or may not be able to go as low as you want.

If you get an offer that works for you, MAKE SURE YOU GET IT SENT TO YOU IN WRITING! I don't know how many times we get a client who made a "settlement agreement" over the phone, made all the payments as agreed, but found out that the debt collector denied ever making the agreement and demanded the remainder of the full amount!

For more information about "how" and "if" Debt Settlement really works, CLICK HERE.

FEDERAL STUDENT LOAN FORGIVENESS PROGRAMS

If you are like thousands upon thousands of current, former or parents of students with too much Federal Student Loans to repay, we have SOME GOOD NEWS!

Again, as with any "government" program, depending on your particular circumstances, you may qualify for one of these new programs. Basically, if you income falls within certain parameters, you may be able to have anywhere from NO PAYMENTS to maybe only a $100 or so.  Make these payments for 20 years, and the remainder of the balance will be forgiven! 

And, if you are in or go into some sort of "public service" career, you may only need to pay the reduced payments for 10 years!

Trying to determine not only IF YOU QUALIFY, but HOW MUCH YOUR PAYMENT WOULD BE, is not very easy (remember....government...). Let us help:

877-492-4109

Notice I said "bankruptcy protection", as in PROTECTION FROM YOUR CREDITORS!

If you ignore the collection letters and calls and are not able to work out a repayment plan or settlement, the creditor or debt collector may decide to FILE A COMPLAINT and then you would receive a SUMMONS.

If you ignore the summons (as so many people do), then the creditor (or PLAINTIFF), will most likely be awarded a DEFAULT JUDGMENT.

Now the credior has the legal right to apply for a WRIT OF GARNISHMENT, not only for your INCOME, but possibly your BANK ACCOUNT(S).

You should seek the cousel of a BANKRUPTCY ATTORNEY right away.

So, there are 4 Programs to control you debt:

• Debt Accelerator Program
• Debt Settlement Program
• Federal Studen Loan Forgiveness Programs
• Bankruptcy

You don't have to live in fear or frustration. Get some help today!

Photo credit:

Jason Rogers

A lady from Portland, Oregon called to ask, "What really determines my credit score?"

There is a lot of misleading information about credit scores and this information should help.

According to the Fair Isaac Corporation (FICO), your credit score is made of many factors, but the most important are:

• Payment History (35%) 
• Amounts you Owe (30%)
• Length of Credit History (15%)
• Types of Credit Used (10%)
• New Credit (10%)

Your PAYMENT HISTORY (which accounts for the greatest percentage in determining your credit score) looks at how and when you pay your debts!

• Do you pay on time?
• If not, how late were you and how often were you late?
• Do you have negative items on your credit report such as a bankruptcy, judgment, lien or lawsuit?

Being late on a payment is not necessarily a terrible factor on your credit report, but they are looking at:

• How late where you (30,60, 90 days, or more?)
• How much was the balance?
• How recent were you late?
• How many times are or where you late?

The next major factor that affects your credit score is the total amounts or balances on your accounts. (This makes up 30% of your credit score!)

Having outstanding balances is not a bad thing, but what the credit reporting agencies are looking for is how much of your available credit have you used?

They refer to this as your "DEBT RATIO".

What is my debt ratio?

Let's say you have 5 Credit Card accounts with a total available credit line of $20,000.

If you have only two balances of the five and the total balance is $2,000, then your DEBT RATIOwould be only 10% (2,000/20,000).

This shows creditors that although you have $20,000 of available credit, you are only using a small percentage and therefore are a better "CREDIT RISK".

On the other hand, let's say of the $20,000 of available credit you have, you have had to charge up $15,000.  Now your DEBT RATION would be 75%!

Creditors could be cautious in lending or extending any more credit to someone with that high of a DEBT RATIO!

The next factor that is used in determining your credit score is the LENGTH OF YOUR CREDIT HISTORY.

Although it may seem unfair, those who are young and/or have never established a credit history will not have a very favorable credit score, but will find it hard to be extended credit.

What type of credit accounts do you have?

The credit reporting agencies look at the various types of accounts such as:

• Credit cards
• Store or retail accounts
• Installment loans
• Finance Company Loans (pay-day loans)
• Mortgages

You don't have to have one of each, but what the credit reporting agencies are looking for are a balance.

For example, if you had 5 or 6 Finance Company or Pay-Day loans (which usually carry very high interest rates and fees), you would most likely be considered a greater risk than someone who had a couple of credit cards (Visa, Master Card, Discover, etc.) and maybe one Sears card.

Finally, what about your NEW CREDIT?

How does New Credit affect my score?

The credit reporting agencies look at several "new accounts" as a greater risk than someone who say, had been using a (or a few) credit cards for several years and just recently signed up for one store card.

It is a negative mark on your credit report to go out and sign up for several NEW ACCOUNTS in a short period of time.

One final bit of advice, DON'T CANCEL OLD ACCOUNTS!

Closing accounts does not help your credit score.  You want an established credit history.

Even if you have had problems in the past, you can improve your credit score!

But what if you have so much debt that you simply cannot keep up with the payments?

Here in Oregon, we've been helping people become DEBT FREE for over 10 years.

Many people have used our DEBT SETTLEMENT program to final become DEBT FREE!

Once it has been determined that you simply cannot keep up with your minimum monthly payments and cannot meet the payment required in a Debt Consolidation or what is called a Debt Management Program, a Debt Settlement Program could be the answer!

We are not talking about secured debt (home mortgage, equity line of credit, etc.) but rather UNSECURED DEBTS, such as:

• Credit Cards
• Store Cards and Accounts
• Personal bank loans
• Deficiency Judgment after repossession
• Private Student Loan
• Pay Day Loans
• Medical bills

A Debt Settlement Program can help you:

• By lowering your monthly total debt payment
• Potentially save you thousands of dollars by negotiating a settlement for less than the full balance due
• Avoid turning to Bankruptcy!

photo by: Casey Kinstantin

The amount of debt the average American has been estimated to be close to $8,000! If you get behind on paying your debts, get ready to hear from DEBT COLLECTORS!

You must know your rights!

YOU DON'T HAVE TO PUT UP WITH DEBT COLLECTION CALLS!

When you get a call or letter from a debt collector, DON'T ADMIT TO THE DEBT, but instead, get the address of the collection agency.

Write a letter demanding that they know longer call you at home or at work.

Mail by certified mail so that you have proof that they received it.

If they continue to call, report them to your state's attorney general.

IF YOUR DEBT IS A FEW YEARS OLD, MAKE THE COLLECTOR VERIFY IT!

The statute of limitations on unsecured credit card debt varies from state to state.

In Oregon, it is 6 years. 

This means that if the debt has had no payments and/or activity for over 6 years, it must be removed from the credit report and in deemed "un-collectable".

When you request a verification of the debt, the collector must:

• Stop all collection activities
• Provide proof of original documentation that you indeed owe the debt

Many times a collector has purchased debts and may or may not be able to verify.  If this is the case, you may not have to pay.

IF YOU ARE RETIRED AND ONLY RECEIVE INCOME FROM RETIREMENT SOURCES, YOU ARE EXEMPT FROM GARNISHMENT OR LEVY.

Debt collectors love to scare seniors and/or retired persons!

If your income is from a State or Federal Pension System and the benefits are automatically deposited in your bank account, the bank must perform a 2 months "look back" if they receive a garnishment request from a collector.

This law went into effect on May 1, 2011.

Unfortunately, this only applies to DIRECT DEPOSITS and not normal deposits.

If you are retired, and only receive retirement income, sit down with your banking contact and see if they will "FLAG" your account in case of a garnishment request.

If they will not, find another bank!

IF YOU ARE FACING A LOT OF UNSECURED DEBT, A COLLECTOR MAY ACCEPT A SETTLEMENT FOR LESS THAN THE BALANCE.

This is called "DEBT SETTLEMENT", and it is done everyday to help people clear up past debts.

Debt Settlement can be done by anyone, but it takes time, patience and experience to get the best settlements.

If you need help in this area, let us know.

Making the choice between BANKRUPTCY and DEBT SETTLEMENT can be a daunting task.  The fact is, one is not the clear winner.  The option you choose will depend on several factors.

Here are some guidelines to determine whether Bankruptcy or Debt Settlement is the right choice for you. 

DON'T THINK OF BANKRUPTCY AS A "GET-OUT-OF-JAIL-FREE-CARD"!

As I research and blog about the debt settlement industry I'm in, I see too many sites that seem to say that Bankruptcy is an easy way to START OVER.

That statement is both True and false.

Before we look into when you should choose Bankruptcy over Debt Settlement, just remember this...

Bankruptcy is a statement that you cannot pay the debts you owe.  Say what you will, that is a hard thing to admit and can cause severe personal turmoil.  Although most people who have to seek bankruptcy protection from creditors do so as a last resort, it is still a very big and tough decision mentally.

DEBT SETTLEMENT IS NOT THE SAME AS BANKRUPTCY

Whether you qualify for a chapter 7 or 13 (personal bankruptcy), you are basically walking away from the debts you have incurred.  Your creditors get paid back very little, if anything on the money they originally loaned you with your promise to repay!

With DEBT SETTLEMENT, your creditors will get paid back approximately 50% of what you owe.  This is better for you because it shows that you made an effort and paid back at least a portion of what you owed.  Down the road, it will be easier for you to get credit when you need it.

BANKRUPTCY WILL SHOW ON YOUR CREDIT REPORT FOR UP TO 10 YEARS!

Make no mistake about it, bankruptcy will have an major affect on you and others!

You may not be able to rent an apartment for up to 2 years following a bankruptcy!

Many employment opportunities will not be available to you if you must state that you have declared bankruptcy in the past or if your prospective employer does a credit check!

Bankruptcy HAS A VERY NEGATIVE impact on your credit score!

In the long run, your credit and credit rating will not be as damaged through DEBT SETTLEMENT as it will be through BANKRUPTCY.

After a debt is settled, the credit reporting agencies:

• Experian
• TransUnion
• Equifax

...will show the debt with a $0 balance and "paid-as-agreed" or "paid-for-less-than-the-full-amount".

When your credit report shows that you have done something to take card of your outstanding debts, it will (believe it or not) start to improve rather quickly!

SO, DEBT SETTLEMENT IS ALWAYS BETTER THAN BANKRUPTCY?

NO!  Again, debt settlement companies that only offer debt settlement have to say that, but it is just not true!

Reputable Debt Settlement companies will discuss all of your options so that you can make the right choice!

After 10 years of helping people get out of debt, I have found that in 99.9% of the time, the client found themselves in severe financial trouble from several circumstances of which they had no control.  Such as:

• Loss of job and income
• Divorce
• Illness and/or disability
• Cut back on the hours of employment due to bad economy
• Forced retirement
• Fixed income that cannot keep up with inflation

At first, you use the credit cards to "JUST GET BY", with the intent on repaying them when things get better.  However, in many cases, things don't get better and now you cannot keep up with the minimum payments.  Then:

• Collectors start to call several times a day (HOW TO STOP CREDITOR CALLS)
• You may be served a SUMMONS demanding payment

You may qualify for a DEBT MANAGEMENT PROGRAM

In a Debt Management Program, you will...

• Have ONE MONTHLY PAYMENT (it may or may not be lower than the total of the minimum payments you now have)
• Have interest rates and late fees are usually lowered or forgiven
• Usually pay back all of your creditors in 48 months or so
• Have improved your credit scores after your balances are $0

But, they question is, can you afford the MONTHLY PAYMENT?

If not, then you need to look at DEBT SETTLEMENT:

• One monthly payment (a payment you can afford based on your circumstances)
• Creditor call slow down and stop
• Creditors are paid a percentage of the debt owed (avg. 50% plus or minus)
• Once your creditors have agreed to a settlement and it is completed, your credit report will show a $0 balance and start to improve

Ifyou cannot even afford the Debt Settlement payment, then you need to consult a BANKRUPTCY ATTORNEY, but be careful!  Not all attorneys specialize in bankruptcy and as the bankruptcy laws seem to always be changing, you must find one that is an expert!

STILL NOT SURE?  WE CAN HELP!  Give us a call at 1-877-492-4109 or simply click on the link below for a FREE Evaluation.

When your debts are out of control and you miss or get behind in payments, the creditor will do whatever they can to collect, including calling and calling and calling....

The good news is that you DON'T HAVE TO PUT UP WITH IT!

3 Tips on How to Stop Collection Calls

First Tip:

According to the Fair Debt Collection Practices Act (FDCPA), a consumer can demand that a creditor or collector STOP CALLING.

Next time the creditor or collector calls, get the address of the company.

Tell them you plan to send them "something" and need the address.

Second Tip:

Write a brief letter that states something like this:

"I realize that I am behind in my payments and have every intention of repaying this debt as soon as my circumstances improve."

"In the meantime, I am making an official request that you cease calling the following numbers: (list home, cell, etc.)"

"If these calls do not stop, I will file a formal complaint about your company with my State's Attorney Genreral's office."

Sign and date.

Third Tip:

Spend a little extra money to send the letter by CERITIFIED MAIL.

You will get a receipt and the recipient will have to sign for the letter, proving they did receive it.

If you feel overwhelmed with your debt, we can help! Simply call 877-492-4109 to speak to one of our debt solutions specialists right now or click on the link below.

Can I use debt settlement in Oregon to clear up old debts?

YES! Debt Settlement is a viable option that creditors will consider when you are facing difficult financial times.

HOW DOES DEBT SETTLEMENT WORK?

After you have been delinquent in paying your accounts, usually those accounts go into an INTERNAL RECOVERY department within the company.  During the first couple of months, you will receive numerous calls and letters about your account.  These calls can be VERY ANNOYING, and in some cases, put your job in jeopardy if they call you at work!

THE GOOD NEWS is that you can PUT A STOP TO CREDITOR CALLS.

According to the FAIR DEBT COLLECTION PRACTICES ACT (FDCPA), once you have requested/demanded that the creditor stop calling you, they must stop!  If they continue, you can report them to the State Attorney General's office and they may be subject to a hefty fine!

After approximately 120-180 days, if the creditor has not bee successful in getting you to start paying again they may offer your a Hardship Plan. Before you agree to their offer of a "HARDSHIP PLAN", you need to read  BEWARE OF SO-CALLED HARDSHIP PLANS!

If you choose to decline the Hardship Plan, your account wil be CHARGED OFF, it will be placed with a COLLECTION AGENCY.  This agency may also be a law firm that only specializes in debt collection.

At this point, the calls and letters start again! Even though you requested that the original creditor stop calling, now your account has been placed or sold to a different company and you must send the demand-to-stop calling letter again!

Your account has now been delinquent for approximately 6 months, and depending on your circumstances, a settlement offer of 50% or less may be possible.  It takes a lot of time and effort to secure a good settlement, but settlements can and are negotiated all the time.

Click here for some ACTUAL SETTELMENT EXAMPLES.

If you are able to negotiate a good settlement (50% or less), before you send money or agree to a check-by-phone, GET THE SETTLEMENT AGREEMENT IN WRITING!

Many consumers have made a verbal agreement over the phone, authorized a settlement payment, and then find out that the company claims that the payment was just toward the ENTIRE BALANCE, and not a settlement-as-agreed.

Yes, DEBT SETTLEMENT IN OREGON as well as most all states is possible, but time consuming.  We have been helping people become DEBT FREE through DEBT SETTLEMENT FOR MANY YEARS  and may be able to help you also.

Can a Debt Collector Garnish Retirement Income?

The answer is NO!

First of all, if you fall behind on your credit card or other debt payments, your creditors don't have the right to automatically garnish any sort of income.  Before a creditor can get a writ of garnishment, they have a whole set of hurdles to get over.

The creditor will write you multiple harsh letters and call you over and over!  They will use many dirty tricks of debt collection to try and collect the debt.

If the collector is unsuccessful in getting you to pay up, then they may decide to file a complaint and you would receive a SUMMONS.  If you owe the debt or you decide not to appear in court to fight the summons, your creditor will be awarded a DEFAULT JUDGEMENT adn they can apply for a WRIT OF GARNISHMENT.

If your only source of income is from one of the following, they CANNOT GARNISH IT!!!

• Social Security benefits
• Supplemental Security Income (SSI)
• Welfare or public assistance
• Spousal support or child support
• Public or private pensions
• Veterans benefits and/or loans
• Disability proceeds of life insurance policies
• Cash surrender value of life insurance policies

WARNING:

If you deposit your retirement income (pension, Social Security...) together with any other source of income (part-time job...), then THE ENTIRE ACCOUNT COULD BE SUBJECT TO A BANK LEVY!

As long as you DO NOT CO-MINGLE your retirement income with any other source of income, then the retirement income is safe!

If you are struggling to pay off your debt, or know someone who is being threatened with a garnishment, our Debt Settlement team can help you settle your debts for 50% or less that what you owe!  Give us a call at 1-877-492-4109 or click this link for a FREE Debt Consultation.

If you have fallen behind on your credit card payments, you know just how annoying the debt collector calls can be. Some people are so bothered by their creditors ongoing calls that they change their phone number or even disconnect their phone to get some peace and quiet. Although those are good options, they really only need to be uses as a very last resort. 

A little education can go a long way.  Here is what you need to know to stop those collection calls once and for all! 

When Can Debt Collectors Call?

The Fair Debt Collection Practices Act (FDCPA) is the Federal law that says what debt collectors can and can't do. They aren't to call you about a debt that you don't owe. When you are first contacted by a collection agency, you have the right to request them to verify the debt is yours. If the debt collector can't come back with proof that you owe the debt, they're not allowed to contact you anymore.

Even without sending a validation request, debt collectors have certain rules they must follow when it comes to contacting you over the phone. They can't call you before 8 a.m. or after 9 p.m. your local time. They can't call you repeatedly, and they can't call you at anytime you've previously stated is inconvenient.

Stop Debt Collection Calls

All you have to do to stop debt collectors from calling you is tell them that you prefer to communicate with them in writing. Written communication works in your favor because it gives you a record of everything that is said. If the debt collector violate the FDCPA, you have written proof of that violation. Keep in mind that, by law, the debt collector does not have to honor this request.

If the debt collector does not honor your request to communicate with you in writing, the next best way to stop debt collectors from calling you is by sending what is known as a cease and desist letter. In the letter, state that the collector should cease and desist further communication with you. Note that the cease and desist letter only applies to debt collectors, not the original creditor.

What Happens After you send the Cease and Desist?

Once the collection agency receives your cease and desist letter they can communicate with you once more, via mail, letting you know one of three things.

1. further efforts to collect the debt are terminated
2. Certain actions may be taken by the debt collector
3. The debt collector is definitely going to take certain actions.

When you send the cease and desist letter to the debt collector, send it via certified mail with return receipt requested. This will provide proof that the letter was sent and received. If the debt collector communicates with you beyond the single instance allowed by law, this evidence will allow you to seek punitive action against the debt collector.

photo by: stevendepolo