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The Day of "Debt" Reckoning
Old 11-29-2010, 05:00 AM   #1
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The Day of "Debt" Reckoning

No surprise here.

Boom in Debt Buying Fuels Another Boom—in Lawsuits -

Since Bankruptcy laws were tightened on debt in 2005, many who would have walked away in the past will have to meet their obligation.

Chapter 7, Title 11, United States Code - Wikipedia, the free encyclopedia

Those that were imprudent and not careful are getting a lesson they will probably not repeat (most people)... for the reckless spendthrifts and ne'er-do-wells; It's just another day in the life.

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Old 11-29-2010, 08:09 AM   #2
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As for me filing bancruptcy is not the best way out. Isn't it better to try debt settlement programs instead? At least they will save your credit score.

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Old 11-29-2010, 08:19 AM   #3
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Originally Posted by AlexN View Post
As for me filing bancruptcy is not the best way out. Isn't it better to try debt settlement programs instead? At least they will save your credit score.
Not a "black or white" issue:

Let me Google that for you:

"debt settlement programs" +"credit score" - Google Search

Effects On FICO Score
During the time when you go through the credit debt settlement process, you pay to the company, not to your creditors. It is only after the company collects a reasonable amount of money when your creditors are paid. If you are making a one-time lump sum payment, there will be no negative impact on your FICO score because of this. But again, since you are not paying your creditors in full as you had agreed upon at the time of the commencement of the loans, it will definitely affect your credit. In your credit report, all those debts will be marked as “paid, but not as agreed”. This will result in a reduced FICO score.

Overall, credit debt settlement programs can be very helpful in getting rid of the high amount of debts you are struggling with, but it is also very much likely to affect your FICO score adversely. Besides that, since you are supposed to make the payment in advance to the company, there is always a risk of losing your money if the company is an unscrupulous one. Therefore, if you must go for these programs, make sure you first do a thorough research and analysis.
I would suggest real legal advice from a real your own attorney before considering such a "service."
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Old 11-30-2010, 07:56 AM   #4
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SEC just crack down on debt services, requiring them to only take fees IF they are successful, many were charging huge fees knowing they couldn't do squat. Most banks won't even talk to them. There are some legitimate non-profit help out there.
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