August 14, 2009
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CC Debt Settlement Advice amid the Myer in TX, Pt.3
The meat & potatoes:Notice the choices get tougher as we go. If you're already to the point where the earlier options aren't your options, read on...
Actual Debt Settlement: This method is typified by an arbitrator negotiating a debt settlement, also referred to as the "Hardship Program". Sometimes, they succeed in getting some of your debt forgiven but, almost in every case, this also results in the destruction of your credit card rating (if you still have one). This can linger with you for five years (sometimes seven). But, if you're already sinking and can't save the ship otherwise, it may still be a good thing for you. Most large credit card providers have hidden provisions at various levels. If you were to call and ask them about it, you would probably find out very little from your first-line credit card support agent. Even if you press for a manager, know that that person's job is to get as much from you as possible to cover the debt (can't hardly blame them).
The negotiators know this well and usually cut right to the chase. Beware of some negotiators, however, who will negotiate a much lower figure (at the peril of your credit rating) and then crunch some figures together with a compromised result. Your credit card debt may be reduced a lot but you may be told it was just a little. Meanwhile, the negotiator will keep the difference in fees without explaining that to you. They can do this in clandestine because they usually collect the moneys from you and then pay on the credit card for you. You're not told how much of what you pay them is actually applied toward your debt.
This doesn't infer that all negotiators are crooks. It just means that you lose some transparency and need to be mindful of your risk. Again, do some background on your negotiator before signing the contract. Otherwise, even though you set up a guaranteed plan to pay the credit card over a longer term, you're still not protected from the wiles and deplorable practices of some collection agencies like "AR Resources, Inc." of Blue Bell, PA. They will lie to you and make promises. Then, once they have what they want, they'll call you and shout at you (yes, actually shout), call you the liar and hang up the phone.