Heads-up On How This Will All Play Out?

Q: I've been considering bankruptcy and almost went to a lawyer to get the process started when I ran across an ad from expert debt consolidation for debt settlement. I'm considering goin this route as opposed to filing bankruptcy but I wanted to see if there are any others out there who have gone this route. The company claims to settle debts at at least 65% or you don't have to pay them their fee. What I am concerned about is what the CC companies will do in the meantime as it will take me at least a year to save up enough money to propose a settlement. My accounts as of right now are about 3 months delenquint with no payments. I stopped paying when I realized that out of about $400 a month, only about $75 was actually going to pay down my debt, the rest were in finance charges, late charges, over the limit fees etc. I'm stressedf to the gills here. I want to get out of debt, and this program sounds like a good option to bankrupcty, but I don't want to get into any more trouble than I already have. If I go with these people, is there the chance that the CC companies will sue me while I am trying to save up for settlement? Has anyone else had any experience with settlement negotiators that could give me a heads-up on how this will all play out?

A: I don't know how much debt you have but I am currently going through the same thing. I have a credit score (you need to get yours) of 507. I was able to get a subprime loan to consolidate some debt. I hope it funds tomorrow. Now This will save me about 800.00 a month. I also have about 17,000.00 in collection accounts on my report that need to be paid. I couldn't get them into the loan because of my being a high risk and all. Well, I started calling the creditors myself and working out deals. Many of them will say no at first, but if you write a formal letter stating what you want to settle with or pay monthly they will listen. I got American Agencies to take 1800.00 on a 2900.00 debt. I am trying to work with Direct Merchants Bank to take 2500.00 on a 6700.00 debt. I have a really neat settlement letter if you want a copy. I went to many debt counselors but none could help me. Typically the monthly payments that they want you to pay (2 or 3 % of the balance I think) may not be doable. Try to work it out with the creditors. If that doesn't work, compose a plan and just start paying. This way if it gets to court the judge will see you are making an honest effort. Keep good records. Getting your credit score up in the 650's is not that hard once you start making regular payments. s

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