Credit Repair Expert: How to Avoid Being Ripped Off By A Debt Settlement Company.
In Sheila Danzig's Truth About Series she investigates Credit Repair and warns you of the downside risks if you get involved with the wrong type of company.
(EMAILWIRE.COM, July 08, 2009 ) Daytona Beah Florida, July 8, 2009
Today in our Truth About Series we look at Debt Settlement Companies with help from credit repair expert Dana Micallef. With so many people over their head in debt they need help and many turn to debt settlement companies. We found this to be a terrible mistake, irrespective of the promises from the debt settlement company. Don’t believe them. You need to understand what the truth is about what debt settlement companies will do and how that may affect you. Most of all you need to understand the difference between Debt Settlement (The BAD Guys) who we will not name, and Debt Management (The GOOD Guys) such as AAA Debt Consolidation http://www.aaadebtusa.com
Debt settlement - how does it work – and why should you avoid it?
When you talk to a debt settlement company about your predicament, they will offer you a plan of settlement with a reduced monthly installment, including their fee. On agreement, you will be asked to pay the agreed monthly installments to the settlement company and not to your creditors. Initial few months payments and a major portion of following monthly installments are treated as the fee and only the balance kept away for debt settlement. When that amount accumulates to approximately 40-60% of your debt, the debt settlement company approaches your creditor(s) to negotiate for outright settlements. But actually you end up paying almost the same amount as your original debt and getting out of debt this way could take many years.
Though you may feel happy in the beginning you will start repenting later. Note that each debt repayment default will get reported to the credit reporting agencies and they remain in your credit report. Even when the debt is finally settled, the credit report will not erase your past defaults. The final settlement will be reported as "Charged-off settled" or "Paid-settled" which is not equivalent to "Paid in Full" report. Such a bad credit will in fact deny you fresh loans or credits in the future.
Another disadvantage is that you owe tax on settled debts as the IRS will treat forgiven debts as your 'income' and expect you to pay income taxes on it!
If you can live with the above, you can do it yourself without the help of debt Settlement Company and save on their atrocious fees. Put away monthly installments in separate account and when you reach 40-50% of your debt, approach the creditor for settlement.
What Should You Do? Debt Management.
Debt management is a viable option to settle your various debts through a single monthly installment, instead of paying individual creditors separately. AAA Debt Consolidation, a well-reputed debt consolidation company has helped many people in difficulties. AAA Debt Consolidation has pre-arranged rates with all major credit cards and collection agencies, which will be lower than the monthly commitments debtors have made to the individual companies. If someone is behind in their payments their account will be re-aged and brought back to current. The creditors are happy to deal with the debt management company as they are known for their trust worthiness in getting them regular payments and therefore the creditors will be agreeable to settle for a lower assured monthly payment. The credit report is quickly repaired as there will be no defaults and you will actually get out of the debt trap in a short period of 4-5 years.
What do people say about AAA Debt Consolidation?
Michele K of North Ridgeville says, "AAA Debt Consolidation has allowed me to consolidate my debt into one easy payment and save about $300 a month."
Another testimonial from Lin1 speaks for itself - "All of my creditors accepted my debt proposals and they have already applied the benefits. Some of my interest rates have dropped by 20%!"
From Collen A. Chico, CA: "Since joining an AAA Debt program, I've seen real progress in paying off my debts. My interest rates were reduced and I combined all of my credit card bills into one payment, which has been a huge help. In just one year, I've also been able to increase my monthly payments. I feel like a huge weight has been lifted off my shoulders."
For more information feel free to contact Dana Micallef toll free at 877.700.8585 or visit the website at http://www.aaadebtusa.com
Today in our Truth About Series we look at Debt Settlement Companies with help from credit repair expert Dana Micallef. With so many people over their head in debt they need help and many turn to debt settlement companies. We found this to be a terrible mistake, irrespective of the promises from the debt settlement company. Don’t believe them. You need to understand what the truth is about what debt settlement companies will do and how that may affect you. Most of all you need to understand the difference between Debt Settlement (The BAD Guys) who we will not name, and Debt Management (The GOOD Guys) such as AAA Debt Consolidation http://www.aaadebtusa.com
Debt settlement - how does it work – and why should you avoid it?
When you talk to a debt settlement company about your predicament, they will offer you a plan of settlement with a reduced monthly installment, including their fee. On agreement, you will be asked to pay the agreed monthly installments to the settlement company and not to your creditors. Initial few months payments and a major portion of following monthly installments are treated as the fee and only the balance kept away for debt settlement. When that amount accumulates to approximately 40-60% of your debt, the debt settlement company approaches your creditor(s) to negotiate for outright settlements. But actually you end up paying almost the same amount as your original debt and getting out of debt this way could take many years.
Though you may feel happy in the beginning you will start repenting later. Note that each debt repayment default will get reported to the credit reporting agencies and they remain in your credit report. Even when the debt is finally settled, the credit report will not erase your past defaults. The final settlement will be reported as "Charged-off settled" or "Paid-settled" which is not equivalent to "Paid in Full" report. Such a bad credit will in fact deny you fresh loans or credits in the future.
Another disadvantage is that you owe tax on settled debts as the IRS will treat forgiven debts as your 'income' and expect you to pay income taxes on it!
If you can live with the above, you can do it yourself without the help of debt Settlement Company and save on their atrocious fees. Put away monthly installments in separate account and when you reach 40-50% of your debt, approach the creditor for settlement.
What Should You Do? Debt Management.
Debt management is a viable option to settle your various debts through a single monthly installment, instead of paying individual creditors separately. AAA Debt Consolidation, a well-reputed debt consolidation company has helped many people in difficulties. AAA Debt Consolidation has pre-arranged rates with all major credit cards and collection agencies, which will be lower than the monthly commitments debtors have made to the individual companies. If someone is behind in their payments their account will be re-aged and brought back to current. The creditors are happy to deal with the debt management company as they are known for their trust worthiness in getting them regular payments and therefore the creditors will be agreeable to settle for a lower assured monthly payment. The credit report is quickly repaired as there will be no defaults and you will actually get out of the debt trap in a short period of 4-5 years.
What do people say about AAA Debt Consolidation?
Michele K of North Ridgeville says, "AAA Debt Consolidation has allowed me to consolidate my debt into one easy payment and save about $300 a month."
Another testimonial from Lin1 speaks for itself - "All of my creditors accepted my debt proposals and they have already applied the benefits. Some of my interest rates have dropped by 20%!"
From Collen A. Chico, CA: "Since joining an AAA Debt program, I've seen real progress in paying off my debts. My interest rates were reduced and I combined all of my credit card bills into one payment, which has been a huge help. In just one year, I've also been able to increase my monthly payments. I feel like a huge weight has been lifted off my shoulders."
For more information feel free to contact Dana Micallef toll free at 877.700.8585 or visit the website at http://www.aaadebtusa.com
Contact Information:
AAA Debt Consolidation
Dana Micallef
Tel: 877.700.8585
Email us
This is a press release. Press release distribution and press release services by EmailWire.Com: http://www.emailwire.com/us-press-release-distribution.php.
AAA Debt Consolidation
Dana Micallef
Tel: 877.700.8585
Email us
This is a press release. Press release distribution and press release services by EmailWire.Com: http://www.emailwire.com/us-press-release-distribution.php.
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