Don't Ignore Debt Collection Letters!

If you are having a difficult time keeping up with the minimum payments due on your credit cards or other unsecured debt, you are going to start receiving calls and letters from collectors!


These calls and letters are upsetting and cause stress and fear.

Most likely, you've never been in this situation before and feel helpless and...yes...afraid.

If this is you, then this blog will help!


The worst mistake you can make after receiving a call or letter is to "just ignore" it!

When we open a credit card account (or any other unsecured account), we are signing an agreement/contract that basically says that we agree to the terms the terms of the contract.

If we do not make the required payments when due, then we have broken our promise and the creditor has a right to contact you.

What can you do?

If you can afford to catch up and get back on track, then great, just send the balance due and start making regular minimum payments.

The problem is that most people who find themselves in a stressful financial situation just cannot do this!

There are several reasons you may have gotten into trouble:

  • Unemployment
  • Divorce
  • Serious Illness or Disability
  • Trying to make it on a fixed income of Social Security or Retirement Income
  • Or other reasons beyond your control

So, if you cannot get caught up and start making the minimum payments due, what options do you have?

Debt Management Program

These used to be called "Credit Counseling".

Basically in the Debt Management or Credit Counseling program, you will make a monthly payment to the company.

The past due balances, fees and interest rates will be modified, but you will end up repaying what you borrowed/charged.

The problem with these types of programs is that the monthly payment is about the same (sometimes a little more) than the previous minimum payment was!

If you can handle this...great!

If not, then you should consider a:

Debt Settlement Program

After 3-4 months of non-payment on your account, the account will most likely be transferred or sold to:

  • Internal Recovery Department of the creditor
  • Debt Collection Agency
  • Law Firm/Debt Collector
  • Purchased by a Debt Buyer

At this point, the Collector may be willing to accept a reduced amount called a settlement.

These can be as much as 40% - 80% of the balance, depending on several factors.

Here's a couple of examples:

Recent Settlements See what we have  done for our clients!

In a Debt Settlement Program, you will be making a monthly deposit (that you can afford) to a Settlement Savings Fund.

As this fund grows, the company will negotiate with the creditor, collector or attorneys for a settlement agreement.

By the way, there are many so-called Debt Settlement Companies that are NOT registered with the state and violate the laws of what they can charge, etc.


Accreditated and A +  by the Better Business Bureau 


If a settlement cannot be negotiated, then there is the possibility that the creditor or owner of the account my decide to retain an attorney in order to start legal action.



First, you will get a SUMMONS. 

The summons legal document stating that the Plaintiff (creditor) has made a legal CLAIM that you (the DEFENDENT) have not met the agreements of the contract.

It will basically say that if you cannot PROVE that you do not owe the CLAIM within 30 days (varies from state-to-state) and submit to the court your Proof called an "ANSWER", then the Plaintiff may petition the court for a DEFAULT JUDGMENT.

If this happens, then the attorney for the plaintiff can petition the court to issue a writ of garnishment or bank levy!

Certain assets and income are exempt, but you have to be very careful!

The point of this is...


Yes, even if you have a judgment awarded against you, there are ways to stop wage or bank garnishments, but prevention is the best way!

What if you cannot afford a Debt Management Program or a Debt Settlement Program...

Then you may have to consider Bankruptcy.

If you have a wage garnishment awarded, your employer will be legally obligated to send 25% (may be different in some states) of you net, after-tax income to the creditor!

Think about that...

Let's say your take-home, after-tax income is $5000/month.

If you are garnished, your employer would send $1,250 to the creditor per the garnishment order, leaving you only $3750 to pay all your bills!

A Bankruptcy attorney may be able to help.

Check around and interview several.

There should be "no charge" for the initial consultation.


If you're in a financial situation where you just can't keep up, DON'T "BURY YOUR HEAD IN THE SAND", reach out for help/options:

FREE  Debt Elimination Summary


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Tags: best way to eliminate credit card debt, oregon wage garnishment, how to pay off credit card debt, making just the minimum payments

Budgeting Money Makeover

Unless you've been living under a rock, you've probably heard of Dave Ramsey and his Total Money Makeover.  In this video, Budgeting Money "Makeover", he talks about budgeting and becoming the CFO of You, Inc.  What a concept!

This inspired me and I know it will inspire you too.  At the bottom of this post is a link to a FREE budget spreadsheet to get you up and running immediately! Enjoy

budgeting money makeover

Key Takeaways from this video Budgeting Money Makeover:

  1. Be the Money Manager of your own life!
  2. A WRITTEN BUDGET is your money goal!
  3. Spend your money on paper BEFORE your month begins!

If you have worked our your budget, and have found that there is litterally not enough money to go around then it's time for you to make some changes.  Dealing with Financial Stress is something no one wants to face. 

If you need help working out your monthly budget or you would like some advise or assistance in getting your monthly credit payments reduced, our Solutions Specialist can help.  Give us a call at 1-877-492-4109 or click on the link below for a FREE Personalized Debt Analysis.

budgeting money makeover


Tags: create a budget, how to pay off credit card debt, Budgeting Money Makeover

Tips to Get Out of Debt FAST: part 2


Yesterday I discussed the first step of how to Get Out of Debt FAST: Get to Know Your Debt. Now you are ready for part 2:

tips to get out of debt fastCreate a Plan to Pay Off Your Debt

Having written down all your debts, it’s now time to determine how you will go about paying off these bills. A solid plan should not be complicated. It’s simply your approach to tackling your debt. There are, however, some important considerations and tools that can help you develop an effective debt repayment plan:

  1. Debt Repayment Calculator: As a starting point, it’s helpful (and sometimes painful) to see how long it will take you to pay off your debt if you make just the minimum payments. And there is a free debt repayment calculator that is very easy to use. While the plan will involve making extra payments, the starting point is to understand what you are up against making just the minimum payments on your debt, and this calculator will help you do just that.
  2. Prepare a Budget: For many, the word “budget” is the dreaded “B” word. But the fact is that you need a budget to control your spending and better manage your money. Remember that it’s the money you don’t spend each month that will go toward paying down your debt.

tips to get out of debt fast  

3.  Be Aggressive About Paying Off Debt: Dave Ramsey talks about tackling debt with “gazelle” intensity. It’s about being aggressive in paying off your debt. As you work through your budget, recognize that every dollar counts, and that the more you throw at your debt, the less interest you’ll pay and the faster you’ll get out of debt.  

4.  Be Realistic About Paying Off Debt: Paying off debt is a lot like going on a diet. You can commit to never eating foods that are bad for you, but is that realistic? The same is true with debt. Yes, sacrifices will have to be made to meet your financial goals, but you need balance.  

5.  Order Your Debt: With your budget in place and an understanding of how much extra money you can put towards debt, it’s now time to map out a specific plan. The question is this–which debt will you put your extra money toward first? That said, here are the top three approaches to deciding how to tackle your debt:

  • Highest Interest Rate First: With this approach, you put all the extra cash you have on the debt that has the highest interest rate. This approach will result in the lowest interest charges and the fastest debt repayment possible.
  • Smallest Balance First: This is the Debt Snowball approach. He suggests targeting the debt with the smallest balance first. While that debt may not have the highest interest rate, the theory is to get one debt paid off as fast as possible. The rationale is twofold. First, paying off a debt gives you a feeling of accomplishment, which may be just the motivation you need to keep on track. Second, by paying of a debt completely, you free up the cash that was needed to make monthly payments to that bill. While you are likely to put that cash to the next debt, in an emergency, you could use it for other purposes. In other words, by paying the smallest debt first, you free up cashflow.
  • Non-Revolving Debt First: While many talk about the two approaches above, few look at the type of debt when deciding which one to pay first. Recall that revolving debt, like credit cards, allows you to borrow again after you’ve paid down the debt. Non-revolving debt, like a car or school loan, does not permit you to borrow again as you pay down the debt. With a car loan, once the debt is paid, the loan is gone. With a credit card, once the debt is paid, the card is still there to use again if you so chose. For this reason, I’ll often focus on non-revolving debt first. Why? Because I can’t go out and charge up the debt again once it’s paid. This is purely a pyschological issue, but an important one, particularly if you fear you may lack some discipline once some of your debt is paid off.

6.  Don’t Forget Your Emergency Fund: An emergency fund is a really important part of a debt elimination program. While you may be tempted to put 100% of your extra cash toward debt, keeping at least some of it aside for emergencies will help break the reliance many have on credit.  

Check back in tomorrow for Tips to Get Out of Debt FAST: part 3

tips to get out of debt fast

Tags: tips to get out of debt fast, debt snowball, create a budget, how to pay off credit card debt

CREDIT CARD SKIMMING & 4 Tips to Protect Yourself from it!

credit card skimmingHave you heard of Credit Card Skimming?  No? Well, neither had I until today and yet I was a victim of it several months ago.  I've often wondered how someone was able to clone my card and go on a shopping spree at the Home Depot.  Today I finally got my questions answered.  

Here's how they did it:





Thanks to those magnetic strips on the back of credit cards, you can pay for gas at the pump or buy groceries at the checkout with one quick swipe through a card reader.

We all love this because it is convenient, but thieves have used this technology to create a new kind of fraud -->> Credit Card Skimming. It's one more danger we must guard all watch out for and another maddening example of how crooks find ways to turn technology against us.

Here's how it works

The bad guys buy magnetic card readers (readily available online) and attach them to legitimate card readers at ATM machines, gas station pumps, movie rental kiosks, or anywhere they think they can get away with it.

The counterfeit card reader captures the credit card information of everyone who uses the machine. (On ATM machines, crooks also attach tiny video cameras to steal PIN numbers.)

They then remove the phony device and use the stored information to buy stuff online or write the data onto new magnetic strips to make counterfeit credit cards or ATM cards.

Counterfeit Credit Card Trends

Portable skimmers (small enough to fit in a palm) can be used by anyone who handles your credit card, such as a waiter. All they have to do is get your card out of your sight for a second. That's enough time to swipe it through the device, and steal your information without you suspecting a thing.

Here's an example of what a credit card skimmer would look like on an ATM machine.  Notice the tiny pinhole camera.  Who would even think to look for that?

credit card skimming

Follow these tips to protect yourself from Credit Card Skimming:

• Don't let your credit card out of sight. Watch carefully anyone who handles your card.

• Keep track of receipts and check your credit card statements regularly to make sure you authorized all purchases.

• Report any unauthorized purchases immediately to your credit card companies.

• Don't use a credit card reader if there are any signs of tampering. Don't swipe your card through devices that offer to clean the magnetic strip. Those are scams designed to capture your credit card information.

Have you been a victim of Credit Card Skimming?  If so, how did you resolve the issue?  I'd love to hear your story.  Let's chat in the comment stream below!

photo by: shawnzrossi

credit card skimming

Need help eliminating your credit card debt?

Our Debt Consolidation and Debt Settlement programs can get you out of debt fast and save you money.  Click on the FREE Debt Summary link to get more information!

Tags: debt settlement, debt consolidation, credit card skimming, how to pay off credit card debt

What is a Debt Snowball?


I've heard a lot of buzz lately about the Debt Snowball method of paying off your debt.  Curiosity finally got the better of me and I decided to do a bit of research.  Here is what I discovered:

debt snowballWhat is debt snowball?

Debt snowball is a process by which you list all your debts from lowest to highest and attack the lowest debt first. You need to pay minimums on each bill except for the lowest one. Pay as much as you can towards the lowest debt so that you can get rid of it as soon as possible. Next, you move on to the second lowest debt and the process continues till you are free from debt.

What are the advantages of debt snowball?

According to personal finance guru Dave Ramsey, “Personal finance is 20% head knowledge and 80% behavior”. Debt snowfall is based on this view. It rightly assumes that paying off smaller debts gives a sense of victory which motivates people to pay off all other debts.

It is relatively easy to pay off bigger debts using debt snowball method. Here you clear the smaller debts first. So by the time you reach the bigger debts, the extra amount that you can pay towards them increases. Consequently, it is possible to eliminate them quicker.

Another advantage of debt snowball method is the reduction of the total amount owed to creditors in a single month. This can save your neck in case you encounter an unforeseen situation like loss of job or medical emergency.

Is debt snowball the right choice for you?

Debt snowball is a simple debt reduction method which is suitable for people who have a wide range of balances. It gives you tangible results and motivation which is missing from other similar approaches. While is it most effective for people who need some encouragement in the form of quick results, individuals with a lot of patience will benefit more with avalanche approach because it is cheaper.

Debt snowball can certainly help you to climb up from the trenches. However, you should remember that it cannot make you debt free with the wave of a wand. But if you stick to it till the end then your patience will be certainly rewarded.

What if you can't even keep up with the minimum payments?

The debt snowball method sounds like a great idea, and for a lot of people it would make sense.  But what do you do if you can't even keep up with the minimum payments? 

If you need to get your minimum payments reduced, you should consider a Debt Consolidation program.  A Debt Consolidation program works along the same premise, but it also reduces your interest rates and monthly minimum payments!

If the payments of a Debt Consolidation program are still too high, then it's time to consider Debt Settlement.  A Debt Settlement program will significantly lower your monthly payment and eliminate your debt for less than what you owe. 

It's hard to decide which approach is your best option.  If you would like a free analysis of your current financial situation and some guidance in determining which option is right for you, our trained Solutions Specialists are here to help! 

Get answers TODAY 877-492-4109

What are your thoughts on the Debt Snowball?  Have you tried this method or are you considering it?  I'd love to hear from you.  Please post your thoughts or questions in the comment form below!

photo by: House Of Sims'

Tags: debt snowball, best way to eliminate credit card debt, how to pay off credit card debt

How to Pay Off Credit Card Debt

1)  KEEP MAKING MINIMUM PAYMENTSpay off credit card debt

The credit card industry loves this!  They know that if a consumer just makes the minimum payment each month, it may take 10-15 years before they ever pay off the account.

When you add up all of the interest and fees they charge, you could end up paying 3-4 times the original amount you charged!


If you have equity in your home, you may be able to qualify for a 2nd mortgage or equity line of credit.

BUT BEWARE!  Right now, these credit cards are UNSECURED.  If you default, you have not pledged anything as collateral.

If you take out a loan against your home's equity and default, your home is at risk!

On the other hand, if you are disciplined enough to pay off the 2nd or equity line quickly, you could end up saving thousands of dollars in interest and fees.


If you are able to make the minimum payments and maybe a little more, then you should consider a DEBT MANAGEMENT PROGRAM.

If you qualify:

  • You will have ONE MONTHLY PAYMENT
  • Th payment is disbursed to each of your creditors for you
  • Most creditors will LOWER your INTEREST RATE and ELIMINATE late or over-the-limit fees
  • Creditors will not be calling
  • You should be DEBT FREE in about 48 months or so


It is not unusual for people in today's economy to find themselves in a financial situation they have never been in before.

This could be due to several factors including:

  • Unemployment
  • Reduced hours
  • Medical bills
  • Divorce

If this is the case and you CANNOT AFFORD THE MINIMUM PAYMENTS, much less the payments required by a Debt Management Program, the a DEBT SETTLEMENT PROGRAM may be you best option to pay off credit card debt.

In this program, an amount of money you can afford is set aside so that at some time in the future, an offer to settle your account can be made.

You may be able to settle your accounts at 50% of the balance.

But, DEBT SETTLEMENT IS NOT EASY and most people cannot do it by themselves.

You may want to consider seeking professional help.


If you cannot make the payments required by either a Debt Management Program or a Debt Settlement Program, then your only option may be bankruptcy.


Get an appointment with a couple of BANKRUPTCY ATTORNEYS in your area.

There should not be any charge for your initial consultation.

You most likely will qualify for a Chapter 7 or 13, and the attorney will explain the differences.

If you would like a FREE CONSULTATION with NO OBLIGATION, then click below and we will send you some information that may be very helpful.

how to pay off credit card debtphoto by: alancleaver_2000

Tags: debt settlement, best way to eliminate credit card debt, how to pay off credit card debt