Covid, Loss of Income, Debt, Bills...       What Can I Do?

We've all been though a very unusual and stressful couple of years due to Covid and the resulting ramifications such as:

  • Personal illness 
  • Family illness 
  • Loss of Income 
  • Unemployment



Were you one of so many people who were forced to use credit cards in order to meet their basic needs?

If so, you may find yourself with more debt requiring more payments than you can afford.


As stressful as this is, you have options.

Let's say that you've accumulated $10,000, $20,000 or more of various credit card or other unsecured debts such as:

  1. Medical bills
  2. Store Cards, or even
  3. Personal Bank loans

The total minimum monthly payment due each month is just too much for you right now.

                             What can you do?

Many people are forced to miss payments or use one card to make payments on the others.

Although you know this is a terrible idea, you have no other choice.

Another option may be to pull money out of your home equity through an equity line of credit or even refinancing your mortgage.

Again, not always the best idea, but what else can you do?

Maybe you have a parent, family member or friend who will loan you money.

I've seen this many times and the results are not pretty!

                           OK...What are my options???

Your credit card company may send you an offer to modify your payment options.

Even though this may sound good, usually, this is not a very good idea!

There are programs that may reduce and/or eliminate interest and fees.

These used to be referred to as "Credit Counseling" or "Debt Management" programs.

The problem with these type of programs is that even though the interest may be lowered and "over-the-limit" or "late fees" may be forgiven, the over-all payment is about what you should be paying now!

Unfortunately, some people decide to file for Bankruptcy.  If you financial hardship is bad enough, then Bankruptcy may be your only option.

But, you need to understand that there are several types of Bankruptcy and depending on your particular situation, you may or may not qualify.

Bankruptcy will stay on your record for 7-10 years, depending on the type of Bankruptcy you choose.

With a Bankruptcy on your record, you will find it more difficult to rent an apartment, qualify for a car loan or even hurt your chances of landing a job.

Although Bankruptcy may be the right option for you, be sure to think it through!

Here's an article that may help:

             "Bankruptcy: How it Works, Types and Consequences"


                     What about Debt Settlement?

Once your unsecured accounts (mainly discussing credit cards) become delinquent 3-4 months, they most likely will be turned over to the credit card's internal recovery department, assigned to a collection agency or sold to a debt buyer.

This is when there should be an opportunity to settle your debt for less than the total balance due.

A lump sum may be required or a good settlement with monthly payments (with no more interest) can be negotiated.

Even though you can do-it-yourself, negotiating with debt collectors can be very frustrating, time consuming and stressful!

You want to find a company that is highly rated with the Better Business Bureau as well as registered with the state.

Does a Debt Settlement Program Work?

After negotiating a settlement, a settlement agreement is sent.

Then, the settlement is either paid in a lump sum (if funds are available) or paid in monthly payments without any more interest.


Personalized  Program Comparison Click here!


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Tags: debt relief solutions, debt elimination without bankrupcy, debt settlement vs bankruptcy, debt settlement in oregon, alternatives to bankruptcy

Is Debt Settlement Better Than Bankrupcty?

is debt settlement better than bankruptcy

As the Director of Settlement Services at Debt Relief, I am often asked...

"Is Debt Settlement better than bankruptcy?" 

I wish that this was a simple answer, but the correct answer is that is all depends.

In this case I am talking about unsecured debt such as:

  • Credit Cards
  • Unsecured Personal Loans
  • Store Card Accounts
  • Medical Bills

Your Options

When Unsecured Debt gets OUT OF CONTROL and you CANNOT AFFORD to continue making monthly payments, what are you options?

1.  In rare cases, you may be able to secure a 2nd mortgage or Equity Line of Credit to use to pay off all of your accounts.

While many feel like this is unwise, it may be to your advantage to combine or consolidate all of your high interest accounts into one loan that usually has a much smaller interest rate.

Of course, the danger is that if you default on this loan, your home could be in jeapordy!

Also, if your home is foreclosed on, the 2nd mortgage and/or equity line of credit may not be dismissed!

2.  If you qualify, a DEBT MANAGEMENT PROGRAM may be a good option. In a Debt Management Program, your creditors usually agree to lower your interest rate and take a fixed payment for approximately 48 months depending on the account.

Often a common missconception, A Debt Management Program is not a factor in determining your credit score.

The problem with a Debt Management Program is that, many times, the total payment may not be less (and is some cases more) than your current total monthly payments!

3.  DEBT SETTLEMENT is an option that you should consider if you cannot quailfy for or cannot afford the payment of a Debt Management Program and do not have or cannot qualify for a 2nd mortgage or equity line of credit.

In a Debt Settlement Program, your accounts will become delinquent and in most cases charged off by the original creditor and placed with a debt collector.  Once your reserve account has sufficient funds, a settlement of 50% or less can be negotiated and the debt is now classified as "settled-as-agreed".

Even though your credit report will show late payments, eventually all of your accounts will show a  ZERO BALANCE! At this point, your credit score will start to IMPROVE!

Many clients have enrolled in our Debt Settlement Program with $25,000, $50,000 or in some cases over $100,000 of combined unsecured credit and have completed the program, becoming totally DEBT FREE and saving 50% or more!

  • If you have no access to home equity or cannot qualify for a consolidation loan...
  • If you cannot afford the total monthly payment of a Debt Management Program...
  • If you cannot afford a reasonable monthly amount for a Debt Settlement Program...

4. ...then BANKRUPTCY may be you only option.

Bankruptcy is a very serious decision and should only be considered after investigating ALL OF YOUR OPTIONS. However, qualifying for a Chapter 7 bankruptcy is not an option for most people after the Bankruptcy laws changed on 2005.

Most people will only qualify for a Chapter 13 bankruptcy and will pay into a plan for up to 5 years before their debts are discharged.

You may have heard that Debt Settlement Programa charge huge fees! While the debt settlement company will and should earn a fee, recent legislation has gone a long way in stopping bad debt settlement companies.

You should always check out a Debt Settlement Company (or any company) at the Better Business Bureau.

With a Chapter 13 bankruptcy, your creditors will get pennies-on-the-dollar and your bankruptcy attorney will earn a fee. This is usually calculated in the monthly payment you will be making to your bankruptcy court.

So, is Debt Settlement or Bankruptcy the best option for you?

Our Debt Solutions Specialist can help you determine which option is the best choice for your situation.  If you would like a FREE CONSULTATION WITH NO OBLIGATION to explore your options based on your particular circumstances, give us a call at 1-877-492-4109 or click on the link below!








Tags: debt settlement, debt elimination without bankrupcy, debt settlement vs bankruptcy

How to Read a Credit Report Like a Pro!

read a credit report

Does reading your credit report make you feel like this? 

read a credit report

Getting a copy of your credit report is simple to do right from your home computer using  When you have your credit report, you'll be able to see what your creditors are saying about you. However, credit reports can be a little confusing and very intimidating. In this post, you'll find a step-by-step explanation of how to read and interpret your credit report.

Section One: Your Personal Information

Here you'll find identifying information like your:

  • name
  • current address
  • social security number
  • date of birth
  • spouse's name (if applicable)

Don't just skim over this section. Make sure everything is correct. One bad piece of information and the credit history listed on your report could be wrong.

Section Two: Credit History

The Credit History section contains a list of your open and paid credit accounts and indicates any late payments reported by your creditors. It is extremely important to read through this section very thoroughly. If you find any information that is incorrect or accounts that don't belong to you, you'll need to submit a dispute letter to the credit-reporting agency.

  • Company Name - identifies the company that is reporting the information.
  • Account Number - lists your account number with the company.
  • Whose Account - Indicates who is responsible for the account and the type of participation you have with the account. Abbreviations may vary depending on the reporting agency but here are some of the most common:

    • I - Individual
    • U - Un-designated
    • J - Joint
    • A - Authorized User
    • M - Maker
    • T - Terminated
    • C - Co-maker/Co-signer
    • S - Shared
  • Date Opened - This is the month and year you opened the account with the credit grantor.
  • Months Reviewed - Lists the number of months the account history has been reported.
  • Last Activity - Indicates the date of the last activity on the account. This may be the date of your last payment or last charge.
  • High Credit - Represents the highest amount charged or the credit limit. If the account is an installment loan, the original loan amount will be listed.
  • Terms - For installment loans, the number of installments may be listed or the amount of the monthly payments. For revolving accounts, this column is often left blank.
  • Balance - Indicates the amount owed on the account at the time it was reported.
  • Past Due - This column lists any amount past due at the time the information was reported.
  • Status - A combination of letters and numbers are used to indicate the type of account of the timeliness of payment. Abbreviations for the type of account are as follows:

    • O - Open
    • R - Revolving
    • I - Installment
  • Date Reported - Indicates the last time information on this account was updated by your creditor.

Section Three: Collection Accounts

If you have accounts that have been referred to collection agencies in the last seven years, this is where they will be reported. The name of the collection agency will be listed along with the amount you owe and, in some cases, their contact information. If a collection is listed on your report that doesn't look familiar to you, contact the credit bureau and submit a dispute letter.

Section Four: Public Records

Here you'll find a listing of public record items that reflect your history of meeting financial obligations. Such as:

  • Bankruptcy records
  • Tax liens
  • Judgments
  • Collection accounts
  • Overdue child support

Look closely at all the information listed here. If anything is mistaken, contact the credit bureau and submit a dispute letter.

Section Five: Additional Information

This section consists primarily of former addresses and past employers as reported by your creditors.

Section Six: Inquiries

Contains a list of the businesses that have received your credit report in the last 24 months. If you find the names of businesses that sound unfamiliar, you should find out who they are and why they're looking at your credit! The credit-reporting agency may be able to help you with contact information.

If you find out that you have more debt that you thought and need help ELIMINATING YOUR DEBT once and for all, our Debt Solutions Specialist can help you find the right program to fit your goals.  Click the link below to get a FREE Debt Summary based on your debt and start heading towards becoming debt free today!

photo by: Kay Kim

Tags: debt elimination without bankrupcy, credit repair, read a credit report

7 things to AVOID before filing bankruptcy

Are you thinking you may have to file bankruptcy?  If so, here are 7 things to AVOID before filing bankruptcy:

1. Do not pay back money to friends or relatives. If you have borrowed money from family members or friends, now is not the time to pay them back. If you make any payments like this within one year prior to filing your petition, you must disclose those payments on your bankruptcy petition and to the trustee at your meeting of the creditors. The bankruptcy court considers these to be preferential, insider payments. That means, you are using money that could go to your other creditors to pay to people you know. It also means that the court can recover those payments from the person you paid. Imagine your mom getting a letter or call from your trustee saying she owes the court money.

2. Do not run up your charge cards. Some people think that if they are going to file for bankruptcy anyway, they may as well charge their Christmas presents or buy the new television they've been wanting. But, that is a really bad idea. Luxury goods over $550 are not dischargeable if purchased within 90 days of your filing date. Also, if you have recently run up your charge cards before you file, the credit card company is more likely to challenge your discharge. If they can convince the court that you incurred the charges knowing that you were going to file for bankruptcy, that is considered fraud and the charges are not dischargeable. You could also face dismissal of your bankruptcy and other penalties for fraud.

3. Do not take a cash advance. Similar to running up your credit cards, cash advances taken right before you file will not be dischargeable, and you will remain liable for repaying that debt.

4. Do not get a home equity loan. People often get a home equity loan to consolidate credit card or other unsecured debt. This is a horrible idea because you are now putting your home at risk. Unsecured debts can be discharged in bankruptcy, but if you want to keep your house, you will have to continue paying the home equity loan.

5. Do not cash out your retirement account. Many people tap into their retirement accounts to try to keep up with their bills, then end up filing for bankruptcy once that is gone. Retirement accounts can be protected in bankruptcy, so there is no need to use up those funds. You will also pay income tax and penalties on the amounts withdrawn. Finally, a retirement account distribution may affect your means test. Protect your future by saving your retirement for its intended purpose.

6. Do not transfer property. Now is a bad time to transfer assets such as cars, boats, real estate, etc. If you do not receive fair market value for the transfer, it could be considered a fraudulent transfer and the trustee will go after the person who received the property to get either the asset itself or the cash value of that asset.

7. Do not ignore your problems. When you are overwhelmed by debt, it is easy to procrastinate and try to ignore the problem. But, if you do that, you are more likely to end up having your wages garnished or bank account levied. The earlier you deal with the problem, the faster you will get relief.  Bankruptcy should be your last resort.  Before making the decision to file bankruptcy, you should consider Debt Consolidation and/or Debt Settlement.

Want to know more about how to avoid bankruptcy?  Our debt eliminations programs can help you get out of debt without bankruptcy.  Get a FREE Debt Analysis by clicking on the button below or feel free to give us a call at 877-492-4109 for a free, no obligation, analysis of your debts and financial situation!

avoid before filing bankruptcy

Tags: debt elimination without bankrupcy, alternatives to bankruptcy, avoid before filing bankruptcy

Why will creditors settle my debts for less than what I owe?

settle my debts

Here's a great question that we get all of the time.

"Why would my creditors settle my debts for less?"

If you don't know mych about the process of Debt Settlement, you might be skeptical of the claims that your creditors are willing to significantly reduce your debt. It may be hard to believe at first, but it is TRUE! Through the debt negotiation process, creditors are willing to settle your debt for a substantially smaller amount than what you owe. (usually less than HALF of what you owe)

Why are they willing to settle your debts for less? It's very simple... To Get Paid! Your creditors would rather get some of your money than none of your money. It makes perfect sense. If you end of filing for bankruptcy, your creditors will not be able to collect any of the debt you owe them. So, if you’re behind in making your payments, your creditors are probably willing to listen to negotiation offers for settlement.

Your creditors have to make a decision to either settle your debt, or risk not collecting any money at all (in the event that you file bankruptcy). Debt Settlement is NOT too good to be true — it’s just basic economic sense for everyone involved.


Tags: settle my debts, credit card debt, debt relief programs, debt settlement, debt elimination without bankrupcy, alternatives to bankruptcy, Credit Card Debt Negotiation, debt settlement help

Help! Get me out of debt!

debt summary

Too much debt? Not enough money? What can you do?

Millions of consumers carry so much credit card debt that it will be almost impossible for them to ever repay the debt by making just the minimum payments.

Of course, the credit card industry knows this, in fact, they really do not want you to ever pay off all of your debt, because their profits come from the outrageous interest and fees they charge!

But if you have had enough and are serious about getting out of debt, here's a plan:


As long as you keep charging, you'll never get out of debt.

If you are serious about, cut them up, burn them, get totally rid of these monsters!


You should use a basic budget planner to help determine how much you have coming in (net, after all deductions) and how much you have going out.

If you total all of you balances, the average minimum monthly payment required will be about 2% of the balance.

Example:  If you have $10,000 of total credit card debt, at 2%, your minimum payment would be about $200/month.

If you have enough left over to make more than the minimum payments due on all of your cards, great! (If not, we'll show you what to do later.)

List all of you cards by:

  • Balance
  • Interest rate
  • minimum payment

Let's say you have $300/month to apply to your credit card balances.

Take the lowest balance and pay the minimum due and add an extra $100.  Pay the minimum on the remaining cards, for a total of $300.

Once the first card is paid off, apply the minimum you were paying on it plus the extra $100 and pay that toward the next.


Card 1 has minimum of $50.  You pay $150 until the balance is $0.

Card 2 has a minimum of $100.  You know pay $150 (minimum of first plus $100) plus the usual $100 for a total of $250.

When it is paid off, you do the same for card #3.

You won't pay them off over night, but you'll probably cut 7-10 years and save thousands in interest and fees.


The you will need to contact a professional Debt Management Company to determine if you should enroll in a Debt Management Program Debt Settlement Program.

In a Debt Management Program, your creditors agree to reduce the interest rates and fees.  You will make one payment monthly (probably close to the $200) and it will be disburse to each creditor according to the agreements.

It will probably take about 48 months or so to pay off all of your cards.


Then you will most likely be enrolled in a Debt Settlement Program.

Credit card companies will charge off delinquent debts after about 180 days.  These accounts will usually be transferred to a debt collection agency. 

At this point, a settlement of approximately 50% of the balance is possible.

Although it is possible to do-it-yourself, debt settlement takes a lot of time and dealing with professional debt collectors can be very frustrating.

If none of these work for you, then you may consider seeking the advice of a bankruptcy attorney. 

Tags: credit card debt, debt settlement, best way to eliminate credit card debt, debt elimination without bankrupcy, alternatives to bankruptcy

I need debt settlement advice!

too much debtA prospect wrote, "Christmas is over and I charged too much!"  Can you help with debt settlement advice?

When someone calls and tells us that their credit card debt has grown to a level where they cannot keep up with the minimum payments, they are in serious trouble.

Bankruptcy should be the last option, so what can they do?

First, we advise that they should get a clear financial picture of their situation.  They need to complete a BASIC BUDGET in order to find out exactly where they stand.

Next, it's time to be honest with yourself.

If your net disposable income (net left over after all bills are paid, excluding credit debt) is less than the minimum total payments required on all of your credit cards, then you really only have 3 options:

1.  Do you qualify for a Debt Management Program?  If you do, then you will have ONE MONTHLY PAYMENT that will be disbursed to each of your creditors according to agreements made with each creditor.

Some creditors will reduce the payment, interest rate and fees to allow you to pay off 100% of the balance over approximately 48 months.

Your creditors will NOT be calling you and according to FICO, being enrolled in a debt management program IS NOT A FACTOR of your credit score.

If you qualifiy for a debt management program, it would be your best option.

2.  If the total payment of a debt management program is still too high, then DEBT SETTLEMENT may be your best option.

Debt Settlement is a program designed to negotiate reduced payoffs on you unsecured credit card debt.  usually, the settlement is at 50% or so.

Instead of making regular monthly payments to your creditors, you will save an amount each month that your budget can handle. 

If you are not disciplined enought to leave this account alone, you may need to seek the help of a professional Debt Settlement Company.

Once a settlement has been negotiated and payment completed, the account will be listed on your credit report as "settled" or "settled at a reduced amount" or something like that.

People always ask, "Will this hurt my credit score?"

At this point, that should not be a consideration.  The goal is to get these creditors "paid off" and not have to file for bankruptcy!

There will be time to improve your credit score later.

If you cannot qualify for Debt Management or Settlement, then your only option may be bankruptcy protection.

Make sure to seek the counsel of a bankruptcy attorney who specializes in bankruptcy.

Tags: best way to eliminate credit card debt, debt relief solutions, debt elimination without bankrupcy, alternatives to bankruptcy, debt consolidation vs. debt settlement, debt settlement help

What is the best way to eliminate credit card debt?

debt reliefWhen faced with too much credit card debt, you really only have 5 options:

1) Continue to make the minimum payments required by each of your creditors. 

Very few consumers understand that the Credit Card Industry does not want, nor expect you to ever fully repay your accounts!  Billions of dollars of interest and fees are earned from the millions of consumers who only pay the minimum payment each month.  It is estimated that in takes the average consumer 15-20 years to repay a single account at a cost of 3-4 times the total amount charged!

2) Home equity loan or line of credit with your home as security.

This type of loan places your most important asset at risk.  If you have sufficient equity can afford the monthly payment, this option may be viable for you.

The problem is that most consumers, who have a serious financial condition due to too much credit card or unsecured debt, usually will not qualify for a consolidation loan.

If you do qualify and secure a consolidation loan, remember, failure to meet the obligation of the 2nd mortgage could result in you losing your home! Be very careful in choosing option #2.

3) Debt Management is a program designed to help you pay off your unsecured debt in about 4 years with significantly lower interest rates and finance charges.

Agreements are established with each of your creditors.

  • You will have one monthly payment that will be distributed to each creditor according to the agreement negotiated by the Debt Management Company. 
  • This payment is may be slightly higher than your total current payment as the minimum payments most companies require is only 2% of the balance and in a DMP, the payment is usually higher.

Will this hurt your credit score?

According to Fair Isaac Corporation (FICO), being enrolled in a Debt Management Program is not a factor in your credit score.

4) Debt Settlement Program (DSP), is a program designed for those who are…

  • Facing financial hardship due to circumstances beyond their control.
  • Have considered a Debt Management Program, but cannot afford the monthly payment.
  • Do not want to file for bankruptcy.

Clients who qualify for a DSP have fallen behind on their payments or most likely, will do so in the near future. 

The objectives of a DSP are basically twofold:

  1. Negotiate settlement agreements with your creditor, usually for substantially less than you owe.
  2. Help you become DEBT-FREE without seeking bankruptcy protection.

 As the saying goes, "if all else fails...":

5) Bankruptcy should be your last and only option.

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 launched a new era:  With limited exceptions, people who plan to file for bankruptcy protection must get credit counseling from a government-approved organization within SIX MONTHS BEFORE they file.  They also must complete a debtor education course to have their debts discharged.

Bankruptcy is a drastic decision and should only be considered after seeking the advice of a competent bankruptcy attorney.

In the midst of our country's financial crisis, you are not alone.  Maybe you should consider seeking help.

For a FREE Analysis that will help guide you to the right decision, click here.

Tags: credit card debt, debt settlement, best way to eliminate credit card debt, debt elimination without bankrupcy, alternatives to bankruptcy

Stop Wage Garnishment!

I need your helpHELP! They took money out of my paycheck and I can't pay my rent!

Debt collectors have the right to file a claim for an unpaid account or loan.

Once they have been awarded a judgment, they can apply for a writ of garnishment.

Although the amount of money they can take from your paycheck varies from state-to-state, it is usually about 25% of your net take-home per paycheck until the entire debt is repaid!

For most people, this would spell DISASTER

It is hard enough paying the bills without losing an additional 25% of your income.

What can you do if you have received a wage garnishment?

Take a few minutes to complete an accurate personal budget that lists your total net income and all of your bills.

Write a brief account of why you are in a financial hardship.  Don't be too long or brief and simply state the facts. 

Make sure to state that if an alternate agreement to the wage garnishment cannot be set up, then you will have to consult a bankruptcy attorney for protection.

Contact the attorney or collection agency that initiated the claim. They will probably ask for the budget and hardship statement before considering an agreement.

In most cases, they will be willing to work out a Stipulated Agreement, whereby you agree to repay the debt at a monthly amount your budget can reasonably handle.

GET IT IN WRITING!  Do not agree to a check-by-phone or any other method of payment without the agreement.

The agreement should specifically state the terms, interest rate (each state sets a maximum rate that can be charged) and the exact dates the payments is due in their office.

Once you have the agreement, make sure that you make your payments on time!  Failure to meet the due date will usually void the agreement!

Negotiating agreements and dealing with collectors/attorneys can be very difficult and time consuming.  You may find it is worthwhile to consult a qualified debt management company.


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Tags: wage garnishment, debt settlement, debt elimination without bankrupcy, stipulated agreements

Is it a good idea to put a medical bill on a credit card?

I have over $50,000 in medical bills that I paid with a credit card. Did I make a mistake?


After reading an article by a local newspaper writer, I acutally agreed, which is very seldom.

It seems the person was involved in an terrible auto accident and had no medical insurance.  After all was said and done, she owed over $50,000! Having no insurance, she decided to pay it with a credit card. Now, the credit card has raised it's interest rate and her credit score has declined as she has a terrible debt-income ration.

Some things to consider:

If she had not paid her bills with the credit card, she probably could have negotiated a much lower settlement amount!

Most medical providers are willing to take payments and in some cases, very small payments.

Most hospitals have charity programs that she may have qualified for. lf so, most of the bill could have been taken card of.

Now that she has paid the bill with the credit card, can she afford $1,000/month (approximately the 2% minimum payment due) each month?

Even if she can, how much will she actually pay if she pays it off?

Using one of several credit card calculators available, given the best case scenario that she could pay $1,000/month and never miss a payment, it would take her over 8 years and almost another $50,000 in interest to repay the card.

If she cannot afford the $1,000/month for 8 years and starts making only the minimum payments due (credit card company's nasty little gimmick), it could take her 86 years (according to the calculator) and almost $187,000 in additional interest!

She may need to consider filing for bankruptcy.  At any rate, she should consult a bankrutpcy attorney or a professional debt management company for more information.


Tags: debt calculator, debt elimination without bankrupcy, Credit Card Debt Negotiation, debt settlement help