Have you used a Debt Settlement company

iVillage Member
Registered: 04-13-2009
Have you used a Debt Settlement company
8
Tue, 04-14-2009 - 3:24pm

If so, please respond. I am consider using one. I have backed out twice now. Once with Freedom debt Relief and once with DebtShield. I have $50,000 in credit card debt and I currently pay the minimum sometimes more if I can. I have never paid late. I am not so much worried about my credit score as I am being able to provide for my 4 year old daughter and myself. Please anyone that can share with me their experiences or offer some advice, it would be greatly appreciated.


iVillage Member
Registered: 10-16-2007
Tue, 04-14-2009 - 7:20pm
I am currently looking into a Debt Managment Plan with CCCS/MMI. This is not a debt settlement company, they do not settle your debts. What they will do is get your creditors to lower interest rates and monthly payments. They then send the payments to your creditors.
If you go to Suze Ormans webpage and look under the resources and managing debt, she does recommend them and it explains what they do. With CCCS/MMI you don't have to sign anything over.
My girlfriend has been going thru CCCS since October and has paid off about $6000 in her cc debt and her credit score actually went up two points.
Debt Settlement Companies and Debt Managment Companies I believe are two different things. Here is the website.
www.moneymanagement.org
good luck.
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iVillage Member
Registered: 11-17-2007
Tue, 04-14-2009 - 7:54pm

A debt settlement company will trash your credit because they wait until all your bills are charge offs then come in and offer them a settlement amount. You open yourself up to being all kinds of legal action. And when they do get you an amount to pay off a bill You must have a huge amount of money to pay these people as a settlement.


If you see Abby on the board She can tell you how they work and what they did to her credit.


Working with a non profit CCCS is totally Different They can help you get back on track


Mary Ann

iVillage Member
Registered: 07-05-2006
Tue, 04-14-2009 - 8:26pm
Hey - this is Abbie and NO, I would not suggest debt settlement. There's just so many better ways out there to handle your debt. First of all, debt settlement makes you pay them a fee for their service which in my opinion is all something you could do yourself with the proper knowledge. It totally ruins your credit and as maryann said, opens you up to legal action. We were sued by one credit card and nearly sued by another. Plus, we had to pay taxes on our supposed 'gains' because we settled for less than what we owed on our debt. There's just gotta be a better way!!!!

Avatar for sohappilyme
iVillage Member
Registered: 03-26-2003
Tue, 04-14-2009 - 9:16pm

I set my mom up with one about 8 years ago. They were highly touted, highly recommended, etc. I sent them money orders each month about two weeks before the due date to make sure they arrived and called to confirm it. I saved all the proof. Four months in, I find out they didn't pay ANY of her creditors. They told me to go ahead and fight it -- I would have been out more money w/ a lawyer (after I worked my way through to the managers and reported them to regulatory agencies). In the end, it wasn't worth it but it made me mad enough to discover that I could do it on my own, and I did. That was the first time I fought my fear and actually contacted creditors and I found that I was able to negotiate on my own much better than the counseling/debt agency could for me (or my mom). I then managed to clean up my own credit report (and DH's) from a mess to "excellent" in a matter of six months. The lender said he'd never seen a credit report so clean.

Obviously my experience is not the norm since those companies still exist, but this was truly (supposedly) one of the 'best' at the time. I'm only posting as a warning to be careful and make sure they hold up their end before you send them too much money. Their services have helped a lot folks and if you go that route I hope they do the same for you, but just don't go in blindly! Good luck!

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Sarah
iVillage Member
Registered: 04-13-2009
Wed, 04-15-2009 - 8:24am

Thanks to everyone who responded. I will be checking out the Suzie Orman Website. Does anyone know that if I do contact my creditors and I can not negotiate with them can I still enroll in a program like CCCS? Has anyone had close or more than $50,000 in credit card debt and used a program like CCCS? If so how long did it take to rid yourself of the debt?


Thanks again everyone! Please keep in touch this support group has given me some hope. One thing I read was a tear never paid a penny towards paying off my debt. I tend to cry when I get thinking about what I have allowed to happen to me. I feel like a mother that has let my child down. She is still young and I want to be able to give her the things she needs and wants when she is older. I am an older mother and I have totally allowed myself to rid myself of my financial future. I need to start now more than later.


Karen


iVillage Member
Registered: 11-17-2007
Thu, 04-16-2009 - 11:10am

I don't know if anyone really told you the first steps that you need to take. So I will.


First go to the dollar store and buy yourself a couple of 1.00 note books I like the ones with the plastic taps in them but any note book will do. One for the car and one for the house. For a month everytime you buy something while you are out put it down in that note book. In our case like yesterday to get a couple of drinks and some french fries it was over $5.00 at Wendys These things add up and most of the time you don't realize it.

iVillage Member
Registered: 08-04-2008
Thu, 04-16-2009 - 11:23am

Karen -


I met with a couple of those companies about 2 years ago, as well as a bankruptcy attorney.




iVillage Member
Registered: 04-13-2009
Thu, 04-16-2009 - 1:08pm

Thanks Mary Ann and Marie!


It is comforting to know that people you don't even know will take the time to help you out. I will definitely stay on here and take advice and update all you very nice people on my progress. I am a very careless spender so to take the time to write down this little things that add up would be very beneficial to me.


I have a Bank of America Gold Line which I owe 23,000 on at 17.99%. Has anyone ever dealt personally with them? My fear is I will call to get a lower interest rate and they will up it just because I am further in debt then when I opened the account.