2/2/2010

It seems on a daily basis, clients ask me during our initial free consultation whether filing for bankruptcy will "ruin" their credit.  My clients' experiences have educated me in that depending on the employment and income situation going forward, this simply is not true.  The bankruptcy will remain on your record for 10 years, but the rehabilitation process can begin the day after you receive a discharge.  Being responsible with future credit, not over spending and paying off and paying on time debts should aid in increasing those credit scores. 

Robert J. Leon

Should you require additional information, please call now 614-315-8104

2/3/2010
Please define helpful. I am sure many of you have been bombarded with media ads regarding debt settlement or debt consolidation companies.  The stories I hear from my clients regarding the structure of these types of companies is astounding. Let me give you the low down.  Do any of these scenarios sound familiar to you?

Hypo #1:  Debt settlement company contacts you.  Explains that they can reduce your debt by 40-60% with a single low monthly payment.  Perfect right?  Well as you later come to realize buried in the often very lengthy contracts that they either send you via email or you fill out on the website, are the "no guarantee" sections.  Also the fact that their fee (sometimes up to $5000) gets paid first before anything attempts to get settled.  3-6 months into the program a creditor files a lawsuit, and your debt settlement company tells you there is nothing they can do, mostly due to the fact that they are out of state and/or they are not attorneys that are able to handle the lawsuit.  Then client comes and sees me and I help them.

Hypo #2:  Same company as above.  6 months to a year into the program, 1 debt is settled out of the 13 submitted.  Then a creditor files a lawsuit.  Client comes to me and explains that their current income could not possibly support a monthly payment amount originally introduced, but worked hard to make it work.  Now faced with a lawsuit, being told that there is nothing they can do for them, seeks my services.

I am not saying these companies are unsuccessful all the time.  But I beleive that they are less inclined to suggest bankruptcy to a client even though it is the best option available because of lack of knowledge of bankruptcy or fear of not paying their fee and losing a potential client.

Robert J. Leon