Debt settlement or bankruptcy? These days unemployment, health problems, a failed business, or a divorce can leave honest people with insurmounable debts and limited options. For many cash-strapped folks in Antioch, Brentwood, Concord, or Richmond, debt settlement seems like the best choice. You’ve probably seen their ads. Debt settlement companies promise to settle your debts for pennies on the dollar without you filing bankruptcy. Their commercials usually feature testimonials from people who claim the debt settlement company saved them by negotiating with their credit card companies and bill collectors. These TV and radio commercials spread the message that debt settlement is an honorable alternative to personal bankruptcy.
Unfortunately, the debt settlement industry has a notoriously poor success rate. According to a 2010 Government Accountability Office report using data from the Federal Trade Commission and 43 state attorneys general, less than ten percent of consumers successfully complete debt settlement programs! Nor does the debt settlement industry explain that creditors can (and frequently do) refuse to settle for pennies on the dollar. Nothing about debt settlement stops collection letters or harassing phone calls either. Eventually most consumers in debt settlement get sued by creditors. Yes, they can and do sue you despite the fact that you’ve enrolled with a debt settlement company. They then get judgment(s) that include all the interest, court fees, and even attorneys’ fees. Next step: wage garnishment, account seizure, etc.
At this point, you realize the Federal Trade Commission is right: Debt Settlement is a scam. In Fact, the Federal Trade Commission shuts down debt settlement companies as quickly as they can, but they continue to spring up all over to prey on the desperate and poor. Don’t be tricked.
At the Law Office of Michael Primus, we have helped hundreds of clients get out of debt, stop wage garnishments, and start fresh through bankruptcy. If you live in Contra Costa County and have been sued or are having your wages garnished due to a civil judgment, contact us for a free consultation.
Call now for a free in office consultation regarding bankruptcy. Offices in Walnut Creek, Antioch and Hercules.