Nowadays, debt settlement concerns are becoming famous as more people endure from debt issues. Current economy has made people lose their jobs and they are unable to pay the complete debt amount to the lenders. The debt settlement concerns give certain debt settlement programs and ways to get rid of debt issues legally.
Necessity for Debt settlement companies
People approach debt settlement companies in order to decrease certain proportion of outstanding balance. A debt settlement company works sincerely to discover an effective process to settle with the lenders. Debt settlement process nearly takes 10 to 35 months and debt settlement works to complete the process within that time period. For any sort of issues related to debt, the borrowers are not allowed to contact the lenders directly; instead they need to contact the debt settlement companies. They take care of the debt issues carefully by convincing lenders on debt issues. Complete communication is done via debt settlement companies and they always speak in favor of debtors.
Last year 1 million bankruptcies were filed and lenders got afraid of such bankruptcy. Because of such bankruptcy fear, the lenders started co-operating with the debt settlement companies. Bankruptcy has become a serious problem for lenders to gain revenue for their business. If the consumer files the bankruptcies on the lenders, it becomes difficult for them to get single money and thus lenders start negotiating with the debt settlement company to yield a fruitful result. In this situation a debt Settlement Company can easily eliminate 40-60% of the original balances and settles amount in short period.
Functioning of debt Settlement group
The borrowers should sign the power of attorney and agreement papers for joining the debt settlement group. Then they are asked to pay the allocated deposit amount regularly to the debt settlement account created by the debt settlement concern. This amount is used to repay the lenders once the debt settlement agent completes the negotiation process. Only when the deal is agreeable the debt settlement group transfers the amount to the lenders’ account. This process is followed and gets over till the balance amount is wiped out. Some of the advantages of having debt Settlement services are it help debtors to have financial freedom, to improve credit scores and to become debt free in limited period.
Watch the video related to debt settlement
www.CreditCardReliefFormula.org What happens if a credit card company sues you during debt settlement? It is easy to settle your own debts often for a dime or two on the dollar. Creditors do not often sue you. But if they do, here’s what can happen…and you will be absolutely shocked.
Help answer the question about debt settlement
Debt Settlement?
I’ve been in a credit counselling service for one year now and I am saving money on the side.
I’ve been recently offered a settelment on a sizeable debt I have. It’s 60% what I owe the company but it’s through a collection agency.
I know that by taking the settlement, the balance will go on my income at tax time, but I figure that the taxes I’ll pay on it will be a lot less than what I would pay if I continue with the payment plan I have been using.
Are there any negatives to taking such a settlement? Can I ask that they consider that I paid it in full on my credit report?
If I can manage the three payments, why shouldn’t I take the offer?
Sorry, I meant 60% OFF what I owe!!
{EDIT} "Who is an Independent Contractor? A general rule is that you, the payer, have the right to control or direct only the result of the work done by an independent contractor, and not the means and methods of accomplishing the result." {/EDIT}
The employer could be viewing you (who can use whatever means and methods necessary to collect debts) as a consultant (by controlling or directing the result of the work done – collecting debts) and give you a 1099-Form rather than a W-2. If you were an employee, the employer would take the taxes out via a W-4 form. If you were not asked to complete a W-4 form, you are not an employee.
If he gives you a Form 1099 every pay period, you are responsible for paying your own Federal & State Taxes as well as Social Security – the full 15.30%.
The higher wages are a consequence of deducting your own taxes.
Go back and read the fine print on your settlement agreement
everything should be addressed there.
Did you use a lwayer? Did they read the agreement before you signed it? Did you read the agreement before you signed it?
How about if you don’t have 7or 9G to settle directly with the CC comp.? I think you are better of with a non profit settlement company. I did it now I pay 335 a month to them and that includes their fee of 50 a month even a non profit charges you something. But atleast am not pay theCC 640 a month no calls and hassle of worrying if my interest is going up. And stay the FUCK away from the CC voltures!
You be better off filling for bankruptcy. They might settle with all your debts but your credit card companies dont have obligation to talk to these people. Also if they will settle your account.. IRS will charge you with those accounts they settled as your INCOME..When you enrolled to this.. it will destroy your credit also because you are not making payments. Lastly, bankruptcy will only cost you at least $2,000 dollars for lawyers fee this program.. they will charge you.. at least 5g
@brianedwards35 That make sense.
this lady doesnt have a clue, shes probably screwed up more peoples lives from this video than helped.
First of all: You CANNOT settle on a debt and ask your creditor to report it as PAID IN FULL! It will never happen!! I guarantee it! That is essentially lying!!!!! They will NOT DO IT! It will always be reported as settled for less than the full balance. But its ok!! Its better than a charged off account!!! 2nd: Make sure you seek out a non profit debt management agency through CCCS. They do exist! Do your research!!!!
First of all: You CANNOT settle on a debt and ask your creditor to report it as PAID IN FULL! It will never happen!! I guarantee it! That is essentially lying!!!!! They will NOT DO IT! It will always be reported as settled for less than the full balance. But its ok!! Its better than a charged off account!!! 2nd: Make sure you seek out a non profit debt management agency through CCCS. They do exist! Do your research!!!!
If the student loans were federal, the government will get their money. Student loans are generally federally insured and have no statute of limitations. They can either take you to court and sue you or they can offset any federal income tax returns that you would receive.
Very strange for them to allow a 20 year debt to go on. My sister owed her student loans and they took her income tax refunds every year for about 4 years. If they do take you to court and win according to New York state law is 10% of your total income. Then you would have a judgment on your credit history which is 20 years and renewable in your state.
You should continue making the payments, as they will not settle on the debt and this way your credit remains unharmed.
Here are links for websites that have useful information.
http://carreonandassociates.com/articles/sl.htm
http://carreonandassociates.com/articles/sl4.htm
http://www.ed.gov/offices/OSFAP/DCS/faqs.html#SOL
This is quite complicated. You need to know your rights. debt collectors are bound by the statute of limitations.
Please visit this message board and post your questions there. There are a lot of people who have been right where you are.
Don't panic!
They are using extreme scare tactics on you.
I would also venture to say that some or all of their collecting is illegal.
Read the NEWBIE SECTION
also, read HELP! I've BEEN SERVED.
The law you are looking for is in Title 26 United States Code, Section 7122. After you read it you will know less than when you started because it is so vague.
If a taxpayer is unable to pay his liability in full and offers an amount that is equal or greater than what IRS feels it could collect over a reasonable period of time, IRS can accept the lesser amount through an offer in compromise.
Hers is a simple example: If you had a car worth $10,000 and owed $5,000 on it and nothing else and IRS said you could make payments to IRS of $100 per month you would have to offer 80% of $10,000, that's $8,000 minus the $5,000 owed = $3,000 PLUS 48 times $100 = $4,800 for a total of $7,800 as a lump sum on whatever you actually owed. Your friend's affairs are probably more complicated and his case might also dictate an entirely different approach including getting the whole account put on ice for a few years or filing for bankruptcy. He can email me if he has any questions.
I am an enrolled agent, licensed by the US Treasury Department and specialize in taxpayers who have large unpaid tax bills and prepare these for clients. I got an offer for a client who owed a quarter million dollar liability accepted at 1 cent on the dollar but there is no way I could promise to do the same for someone else. You do not have to have a representative but the process can be pretty intimidating if you haven't had any experience. That decision is up to you. In any case, stay away from the companies that advertise on TV. They have very high fees (about three times what I charge my clients) and bad performance records.
The truth of the matter is that they (the collections agency) DO NOT have to follow the FDCPA if they are a part of Chase (considered in-house collection).
The Fair Debt Collection Practices Act DOES NOT apply to major credit card banks? It applies only to the collection attorneys and professional debt collection companies they might hire. Original creditors are regulated by state law; however, the major credit card companies follow policies that closely mirror those of the FDCPA and will comply with your request to stop phoning you at home and work, etc., just as if you were dealing with a collection service. If you believe you have been harassed by an original creditor, or that the original creditor has done something illegal or threatening towards you, then research your state laws on the subject and contact the proper authorities to file a formal complaint. Typically, the Attorney General in your state is the proper authority to contact.
Also the OC (original creditor) or a collection agency as well as an attorney does not have to agree with any payment programs or settlements as offered by those counseling services.
Here is a link to the FTC explaining what to watch for in regards to debt consolidation, credit counseling, and debt negotiations programs
http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre19.shtm
Also, if you or your spouse is active duty then you qualify for help from the Soldiers' and Sailors' Civil Relief Act of 1940, you may qualify for any or all of the following:
Reduced interest rate on mortgage payments.
• Reduced interest rate on credit card debt.
• Protection from eviction if your rent is $1,200 or less.
• Delay of all civil court actions, such as bankruptcy, foreclosure or divorce proceedings.
To learn more about these or other provisions of the Soldiers' and Sailors' Civil Relief Act, contact your unit or installation legal assistance office.
Hope this helps with your question
A few points, feel free to challenge:
1. If a person is unable to make even minimum payments, how will they be able to settle with the CC companies? Are the CC companies really going to accept lower payment terms without any guarantee of paying? That would be like extending even more credit to a person who who has already shown that they are completely incapable of paying.
It’s so good to be aware…. Thank you!
You mentioned in here that the money can be obtained when "he quits, retires, or dies." Go ahead and kill him! Better yet, run over him with the truck he wants to unload.
why worry about the stupid Fico score. is it really worth it to live beyond ones means? best remedy of all is to work harder and pay the debt off and never take on more than you can chew.