Debt Settlement or BK?

[clig_fred]

[mmcconn2]

I can give you my personal experience on this, I struggled for 10 years paying my bills and kept them all current hoping not to ruin my credit, then I used debt negotiation keep in mind during debt negotiation no payment are being made, you are banking the money in hope of making a lump sum payment to the creditor, well it got to a point where I could not even pay thier fee, so I spent 10 years paying intrest and then a $9000 fee to the debt negotiation company and in the end filed BK ch7 had I done this even 2 years ago I would still have my $9000, so in short weather you use BK or debt negotiation you are ruining your credit cause you are not making payments, so looking back I wish I had just filed BK years ago, but I tried my best to pay everything off, hope this helps, this is not advise just my experience. Also in BK you only have to show at the end of the month after you pay your bills you do not have any money left. Good luck!

[HRx]

Hi,

Save your money and negotiate yourself. The company you're referring to, can't do anything you can't! You simply need to speak to the person at with the creditors who has the authority to negotiate. All negotiations should be succinct and in writing.

BTW - What is your DTI (Debt to Income) Ratio? You may be able to file Chp 7 instead, which may ultimatley be more beneficial to you.

-Todd

[clig_fred]

Debt to Income in past 3 years and BK

Hi mmcconn2, I am SORRY you had to go through all this trouble and end up filling for bankruptcy anyway!! So please keep visiting forums and sites like this to help you in making financial decisions. I found you and Todd VERY helpful!

Well, as far as my debt-to-income ratio I can say that my income was $35,000 every year for the past 3 years. My debts were $40,000 average. Now they are $43,000 unsecured. But NOW I WILL receive $5000 each month for a job I was extremely lucky to find. The job lasts for 2-3 months only. So does this ruin my chances for bankruptcy (Chapter 7)? Does the BK court look at the 3 years or just the current salary status? There are no tax deductions from my paycheck (I will get $5000/ month) since I am sole contractor (W-9). This means I am responsible to report to IRS. I just want to know if this disqualifies me from Chapter 7.

After hearing what mmcconn2 said, I feel that Debt Settlement companies are questionable! What about the ones that are member of the Better Business Bureau (BBB)

Thank you again.

[waziggy]

I agree with Todd. Negotiate on your own. Recently I too had to choose between BK and repayment somehow. Well, after seeing an attorney I realize (1) the attorney's can only steer you to BK (can't bill for credit counseling even when they advertise in yellow pages under credit counseling.
(2) There are many for profit and non-profit credit counseling agencies but the real ones that work non-profit don't charge - they're here to help you when you're in trouble and again don't charge for their services. Suggest you might check your local United Fund group for a publicly funded counseling service. (3) I've personally contacted all my creditors and told each that the attorney we saw recommended we declare BK and not notify them of our troubles but let him file and notify them through the BK - end result is that if you BK they get nothing, zip. As such, I wrote letters to them that I would be willing to offer to pay 50 cents on the dollar for all past due debts at this time. They are jumping on this offer since 1/2 is more than nothing. After calling each - get the contacts name and follow up with a letter referencing the call and the offer at 1/2 with an expected due date anywhere from 2-3 months out (buys you time). Then when you write the check put in the memo section "All claims paid in full" and include a letter listing total amount due with the offer at 1/2 payment including the check # applying. Hope this helps.