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Debt Repayment Program Question

Posted by abbey_cny (My Page) on
Tue, Nov 7, 06 at 19:25

About 15 years ago I was in debt up to my eyeballs due to STUPID behavior on my part, I must confess. I went to Consumer Credit Counseling for assistance. They were great. Helped me work out a budget, contacted my creditors and got my interest rate reduced etc. I paid everyone off (I felt so good) and rebuilt my credit. All is well with me. However, a co=worker has confided in me her similar debt problems. I shared what I had done, and recommended CCC to her. Before she called CCC she heard an advertisement for Debt Repayment of America (I think that is what it is called) who supposedly guarantees they can get your credit card bills reduced by 50% or more due to secret credit card programs they know about that the credit card companies don't want you to know about. It sounds fishy to me, and just the fact that your aren't paying off your bills in full seems to me would tarnish your credit even further. However, I know nothing about this organization and my only experience has been with CCC. So is anyone familiar with this Debt Repayment Program of America? Any good or bad information about them? I would like to steer my co-workers in the right direction, and right now she is seeing the debt repayment company as a quicker fix than CCC. She needs an organization to arrange her repayments for her, she is not the type of person to contact the credit card companies themselves and try to work out a plan (I suggested that also) so any information would be appreciated.

Thanks.

Abbey


Follow-Up Postings:

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RE: Debt Repayment Program Question

She sounds like she should have someone who knows a bit about finances, debt, and one's financial record, to go with her.

She has made some mistakes in the past, and may not know if what she is getting into is a good deal or not.


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RE: Debt Repayment Program Question

Abbey
First congrats on getting your credit paid off and in control.
As for your friend
she needs to RUN not walk away from these people. there is no "secret credit card program"
This is one of the dreaded "settlement" companies I have spoken of in a previous post.
this is how they work:
they tell you to stop paying your credit card bills and send them a certian amount of money each month. When your "account" with these folks hits a certian ammount(less the money they have taken for their "fees") they will then go to the creditors and offer them 50% of the balance to settle. If you friend is not late the chances of this happening is very very slim.
What they don't tell you is credit card companies look upon these companies as a industry "joke"
also what they don't mention is not paying your bills will result in late fees and negitive reports on her credit report.
They also can't promise that the credit card companies won't "sue" her. When I worked for a major credit card company and we would receive these "settlement companies" letters we immeditally would send the account to the litigation dept for review. If there were any assets like a home or accounts that were being paid we would proceed to get a judgement against the debtor.
Another thing they don't mention is any settlement over $599, is reported to the IRS so for example:
Balance $10,000 settlement $5000. the $5000 that wasn't paid is reported to the IRS and your friend would have to report this as income there by raising her taxes.
finally should your friend decide that the collection calls and possible litigation is not worth it, the damage she has done to her credit report will remain for 7 to 10 years allot longer than going the CCC route.
there are no "magic" quick fixes to getting out of debt other than a good repayment plan.
You are the best example how well ccc can work that is where she should be going
Karla

p.s. sorry for any typos but it is 5:30 in the morning lol


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RE: Debt Repayment Program Question

Thank you Chemocurl and Karla for your replies. Chemocurl- Someone will be going with her, most likely me as I don't think any of her family members know about her debt. She just happened to be bemoaning her credit card payments one day when there were just two of us in the office, and I decided to share my experience in the hopes of offering encouragement. Then she had to hear that darn commercial!
Karla, Thanks so much for that explanation. I knew what that advertisement said couldn't be a good program, but I had no idea how they would manage to reduce debt. I will show her your explanation and encourage her to make that call to CCC.
They were a godsend to me and I know they can be for her. The last thing she needs is to ge suckered in by some less than reputable company.

Abbey


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RE: Debt Repayment Program Question

abbey
your welcome, I am so glad you asked and how lucky you friend is to have you make sure she didn't get sucked in m their advertising. These companies are one of my bigest pet peeves in the credit industry. Their "song and dance" has "ruined" more folks credit than you could imagine. Though it could be fun to go with her to "meet" with them and you could asked them about the things I told you. Could be fun to see them tap-dance around .
If you friend needs more info tell her to feel free to send me an email
Karla


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