Sword7
Apr 22 2008, 10:07 PM
Hello folks,
I checked lowermybills.com for debt consolidation and noticed something called debt settlement. That is new to me. Does anyone have any experience with debt settlements?
Which is best method for consolidation? Dabt Management Program? Debt Consolidation Loan? etc...
Thanks,
Sword7
radi8
Apr 22 2008, 10:32 PM
A loan does the least damage to your credit. They can work if you have the discipline to not run the cards (assuming it's CC debt) up again while you're paying on the loan.
Debt Management is a "DMP" plan, where they work out agreements with your creditors, you make a monthly payment to the organization and they distribute it to your creditors. This is a hit-or-miss proposition, often at least one creditor doesn't agree to the plan and keeps adding interest and fees, and reports you late. Every month.
It's essentially an informal chapter 13 from a creditor's POV, only slightly more risky as it's NOT a BK and they know you can file at any time. Plenty of CCCS plans turn into BK's down the road, and they know it. You are a credit time-bomb.
Still, in some situations it's the best option if you are ever vigilant over the payments, the creditors and the reporting.
Debt settlement has a high likelihood of getting you sued. Search for "debt settlement" and you'll find threads where exactly that has happened.
The problem is- you are told to save up money to make a settlement offer to your first creditor. While you are doing that, the debt negotiators contact your creditors and tell them what you are doing!
What the creditor hears is: you have income, and you have savings. The race is on to sue you to grab both.
Why would they wait in line for a settlement offer when they can sue and get 100% plus fees and costs? IMO this is never, ever a good option.
Sword7
Apr 23 2008, 07:44 PM
Hello folks,
Well, thanks for info. I learned that debt settlement is too dangerous to your credit. I forget it about that because it can affect my credit and mortgage, etc.
Thanks again,
Sword7
powers64
Apr 26 2008, 06:16 AM
QUOTE
I learned that debt settlement is too dangerous to your credit. I forget it about that because it can affect my credit and mortgage, etc.
not to mention that lowermybills.com is owned by Experian. If you use them, you are providing all of your info to Experian. I wouldn't do business with them or any of their vendors.
http://www.experiangroup.com/corporate/about/activities/