Debt settlement was a booming business until the Federal Trade Commision and the Attorney Generals around the country starting cracking down on them last year. Presently, the FTC has shut down numerous debt settlement companies such as the one in article here. The FTC sued the two principals of the firm Debt Relief USA Inc. for allegedly luring customers in with lofty promises of settlement of their debts while performing little or nothing in actual results. Debt settlement is sometimes a possible alternative to either a Chapter 7 or a Chapter 13 bankruptcy. Some of my prior clients and current clients had tried a fly by night company in order to settle their credit card debt. This is generally how it works, either the person would pay an up front amount to retain the debt settlement firm, and most of the time they would pay a monthly payment to the debt settlement company. That monthly payment would sometimes be used to line the pockets of the company. What the debt settlement company is supposed to do is negotiate with the creditors to settle the debts for a lump sum of money. However, in order for a creditor to settle with the person in financial distress that person must stop paying all their creditors and let them go behind. Credit cards and other debts go to the default rate of interest, adding late charges and the balances increase. Often the person in financial distress would be paying the company and calls from creditors would continue and eventually a wage garnishment or lawsuit would come. Once the person who hired these companies would realize they were getting little or no results they would disengage the company and call a bankruptcy lawyer like me. However, the contract that the person signed usually doesn't allow for a refund or much of a refund in the event of a customer disengaging them.

Bankruptcy is federal law! Consumers in financial distress have a right to file a Chapter 7 bankruptcy or a Chapter 13 bankruptcy whichever applies to them if you so choose. It stops creditors from suing, harrassing, collecting, or doing anything to take money or property from you once the case is filed. At the end of either type of bankruptcy you receive a discharge which is a federal court order that discharges your obligations to pay any of the debts that you had at the time of filing and which were listed in the bankruptcy case.

One of the keys with hiring any company or attorney, including a Chicago bankruptcy attorney such as myself is to do your research and ask plenty of questions. If it seems to be good to be true then usually it is! As an attorney, I have a fiduciary obligation to give a client or a potential client correct advice, and not to misinform them or mislead them with lofty promises or misleading or false information. I offer a free consultation and would be happy to speak with you regarding your options whether or not it includes filing bankruptcy. Please call me if you want to schedule a free consultation at 312-489-8182 or email me at marc@practicinglaw4u.com. I want you to lose your debt and keep your dignity!

Marc