Do Not Use Debt Settlement. Period.

Its about one week ago and I am in my local Dunkin Donuts.  There is a man next to me, maybe 21 or 22 years of age.  He is on the cellphone next to me and is saying things to the effect of “No, you tell them they’re exact debt total after your run their credit report.  That way it will look like you did a ton of research.  Then you tell them that Bankruptcy will ruin their credit forever.  You should be able to sign up 75% of the people you call.”  If the ballgame wasn’t over already, it is now.

Before I go any deeper into this, let me state that I HAVE done debt settlement with some of my clients (perhaps 4-5 over  a few years).  The reason behind that was 1. They were told the drawbacks and still wanted to proceed.  2. They had too many assets to file for Bankruptcy.  3. They had cash set aside to immediately pay the debts.  4.  They had few creditors.

Ladies and gentleman, for a myriad of reasons my opinion is that debt settlement is a complete scam and ripoff, intended to do nothing more than take your money while promising you a gigantic reduction in principal and interest based on absolutely nothing.  Again, my opinion.  However, when a young man is on the phone “pitching” another potential recrutier (telemarketer) on how to sign up (instead of help) clients, you know its time to head for the hills.  Also, I now receive rather constant emails from people looking to set up their own debt settlement companies, and they inquire as to how they should do so legitimately.  Those emails go unreturned.  In previous post I have laid out exactly what I think is wrong with the fee structure of debt settlement, and why I think it can almost never work unless the client has significant cash to play with and to settle these debts with.  This is simply not the case for the overwhelming number of people out there.  Yes its painfully obvious I am a bankruptcy attorney and it sounds like a ringing endorsement to file for Bankruptcy.  Do I legitimately believe that filing Bankruptcy in New York can help someone with their debts?  Yes I do.  Would I rather see someone file for Bankruptcy than do debt settlement in New York?  With few exceptions, yes.  But in no way is this simply a rant to try and get business.  Instead it should be an “open your eyes” moment.  The people that are now entering the field of debt settlement look to be the same people who believe in “sales” or helping people drowning in debt.  Its simply another way to make money for them.  Again, not all of them, but in my opinion, many if not most.  Do yourself a favor and do some research on the internet about debt settlement and look at the complaints people have.  It will save you a significant amount of time, money and heartache.