Is Dave Ramsey a serious financial planner?

[keepsmiling]

In 2007 I found myself in a financial mess like many here. So I looked into all kinds of things, read Daves Total Money Makeover book and then took the class. I followed it almost to the tee for about 1 year and even coordinated a class for my Church. After working his plan for a long time I realized I could not follow all of his advice. I did not file BK but did stop paying on an underwater 2nd mortgage that to this day is still out there charged off but underwater so the lender just sits. We have since paid off all other debt using his debt snowball plan and gotten rid of all credit cards. I would never tell someone who is hopelessly in debt that they should never file BK. If you can work your way out of debt in less than 3 years I think filing BK you should at least try to pay off your debts .

but one day the second WILL come after you... and you wasted all that money paying the others
you might want to attempt a settlement before this bites you in the butt

[WanabeFree]

but one day the second WILL come after you... and you wasted all that money paying the others
you might want to attempt a settlement before this bites you in the butt

The way I look at it is since we are in California and we are a one action state .The second has only one move to foreclose ad it will be a long time before they do that since we are nearly 100k upside down on a 106k 2nd. They can take the house in foreclosure but we would just move on and rent, they would get nothing from us as long as we stay current on the first. Our payment on the first is affordable and comparable to what we would pay in rent.
We did try at one time to settle and would like to do so if possible. The Second did offer a 10% settlement about 2 yrs ago but also wanted financials. we did not have that much so I countered with a 5% offer and refuse to send any financials accept a cashiers check with a written agreement.They never responded and have since sent it to a collection company that now wants 20%. At that price they can have the house if they want it. So yes we are in a no mans land and will just wait it out. If and some how we ever had to use the BK card it would be to get rid of any deficiency but that is not likely.

[avengers]

Yeah, his anti-BK status is extreme. In his book, he talks about how stressful BK is and he wouldn't recommend it for anyone. He has a sidebar that discusses a couple that had filed 3 BKs before. Now, they lost their income again and have huge debt. He was going to file BK. His son convinced him not to do so and just follow Ramsey's plan. Ramsey then lists the good news: they have paid $26k in debt and have a strict budget they stick to.

My problems with that scenario:

1) a lot of the problems with BK that Ramsey lists deal with the fact that it's stressful and stays on your credit report for years. But someone who has already been through BK already (3 times!) knows what to expect and already has that on their credit report.

2) let's just say Ramsey's budgeting system works excellently. Wouldn't this couple have been much better off had they decided to follow the budgeting plan AND not had $26k debt (actually probably a lot more than $26k debt, he only mentioned that they paid off $26k. The implication is that they owed more.)

IMO, the primary reason this family would have to not file BK would be the moral obligations to pay your debt. But this family was unemployed and definitely had better places to put their next $26k of income.