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Archive for July, 2010|Monthly archive page

Zombie Credit Card Debts

In Uncategorized on July 31, 2010 at 10:53 am

Did you know you can be sued on old credit card debt for 15 years? Even worse, every time you make a payment the 15 year time frame is extended. Some companies specialize in collecting old debts. They try to get people to make payments on debts that are more than 15 years old. The Federal Trade Commission recently issued a report recommending changes to the law. But for now, collectors will still try to collect on the debts. Even if the debts are so old th law will not allow them to sue you.

Report Explains Failure Of Mortgage Modification Program

In Uncategorized on July 22, 2010 at 11:31 am

Only 340,000 homeowners received a permanent modification of their mortgages under the federal program in the last 15 months. This falls far short of the expected three to four million people the program should have helped. Why has the program failed to assist more homeowers? Two reasons were cited in a recent report to Congress. The Treasury Department, the agency that oversees the program, failed to provide clear goals. The program pays mortgage service providers for loans that get modified. But in many cases, the service providers may more money if the family goes through foreclosure.

So for many people, getting rid of credit card, medical and other debt through bankruptcy is the only way to afford house payments.

Debt Settlement Scams

In Uncategorized on July 7, 2010 at 1:10 pm

Have you considered using a debt settlement company to deal with your debts? Be careful. The New York Times reported settlement companies typically have fees of 15 to 20 percent of credit card balances. Even worse, they tend to collect fees upfront, regardless of whether a customer’s debt is actually reduced.

Since 2004, 21 states have broght 128 enforement actions against debt relief agencies. Consumer complaints received by states attorney generals more than doubled between 2007 and 2009.

In the typical case, customers make monthly deposits into special accounts while skipping credit card payments. Once the money in the account reaches a sufficient size, the settlement company negotiates a lump sum payment with the creditor.

What they don’t tell you is that once you stop making payments, the creditor get angry. Collection calls and lawsuits quickly follow. After getting a law suit, one customer called her settlement company, Financial Freedom. She was told, “we don’t have any control over that, and you don’t have enough money in your account for us to settle with them.” Her account held only $1,470 even though she paid $3,700 into it. The rest went to the settlement company as fees.