Debt Settlement — Why the Critics Are Wrong


Explains why critics of debt settlement are wrong about this alternative to bankruptcy. Discusses the three main criticisms of debt settlement as well as the positives associated with this method of debt reduction.

bankruptcy alternatives, debt settlement, debt consolidation, credit score

A lot more people are becoming interested in debt settlement as an alternative to bankruptcy. That’s because a new bankruptcy law was enacted on October 17, 2005, which means a rude awakening for many consumers seeking a fresh start in bankruptcy court.

It used to be that 7 out of 10 people filing personal bankruptcy were granted Chapter 7 status, where the unsecured debts are totally wiped away. That has changed under the new rules. If your income is above the median for your state, or you can pay back at least $100 per month toward your debts, then you’ll be turned down for Chapter 7. Instead, you’ll be shifted into Chapter 13, where you pay back a portion of the debt over 3-5 years.

It gets worse. When the court calculates your allowable living expenses, it will use the approved IRS schedules, not your actual documented expenses. So even if you don’t think you can pay $100 a month or more, the judge will probably disagree. Instead of a fresh start, many people will be faced with the grim reality of a harsh 5-year plan, on a court-mandated budget that forces them to adopt a much lower standard of living. That’s where debt settlement starts to look pretty attractive.

Yes, I know debt settlement has its critics. I’ve criticized aspects of the industry myself. But what the critics don’t seem to understand is that this approach is for people who would otherwise go bankrupt! Let’s examine the three main complaints against debt settlement and see where the critics are missing the mark.

“Debt settlement has a negative impact on your credit score.”

Wow. Big deal! Pretend it’s two years from now. Would you rather have an A+ credit rating or be totally free of debt? Pick one please, because you can’t have both. All debt reduction programs have a negative impact on credit scores. That’s why only people who truly can’t keep up with their bills should go into one of these programs. But it’s pointless to worry about your credit while you’re being crushed with debt. That’s like worrying about how the yard looks after your house has burned down.

“You might have to pay taxes on the canceled portion of the debt.”

I’ve always been amazed at how frequently this lame criticism is repeated in article after article. Yes, it’s possible that you may need to pay taxes on forgiven debt balances, but the odds are against it. That’s because the IRS allows insolvent taxpayers to exclude canceled debts. So unless you have a positive net worth, you probably won’t need to pay taxes on your settlements. And even if you did, so what? You’d be paying taxes because you saved a bunch of money off your debts! And this is a problem?

“Collection activity will continue and you might get sued.”

Yes, if you fall behind on your bills, your creditors will most certainly continue attempts to collect what’s owed, and one or more of those creditors might sue you in civil court. But again, this criticism totally misses the mark. Collection activity is already a function of being in debt trouble. At least debt settlement allows the consumer to use the collection process to eliminate debt through negotiated compromises. Even lawsuits need not be cause for panic, since they can often be settled out of court. The only reason to allow a legal action to proceed to the point of wage garnishment, property lien, or bank levy is lack of financial resources with which to settle. And if that’s the case, the debtor should be talking to a bankruptcy attorney anyway.

In contrast, let’s look at some of the positives of debt settlement.

1. You can save $1,000s versus any other method of debt elimination (except for Chapter 7 bankruptcy, which is much more difficult to accomplish now that the new law is in effect).

2. You can get out of debt in 2-3 years, and much faster if there is some available home equity to work with. This is a lot better than 5 years in the financial boot camp of Chapter 13 bankruptcy, or 5-9 years in a credit counseling program.

3. You keep control over the process more than with any other approach.

4. You maintain personal privacy. With bankruptcy, your case file becomes a matter of public record, easily located via Internet search by future employers, landlords, or creditors.

5. You retain your dignity while working through your financial problems. Bankruptcy still feels like failure to a lot of people. Debt settlement represents an honest and ethical alternative to that extreme solution.

6. You can adjust your monthly funding into the settlement program up or down depending on real-world conditions in your financial life. If your income fluctuates from one month to the next, or you get hit with an unexpected expense, it won’t torpedo the whole program. The built-in flexibility of debt settlement gives it a huge advantage over other options, all of which require a fixed monthly payment.

Once you’re made the determination that debt settlement makes sense for your situation, you’ll need to decide whether to go it alone or seek professional assistance. For people who aren’t easily intimidated, there’s no question that the do-it-yourself approach is the way to go. For others who can’t handle the least bit of pressure or just want to focus their time and energy elsewhere, hiring a professional settlement company may be the correct choice.

If you do decide to take the do-it-yourself approach, follow these tips:

* Use a privacy manager on your telephone service to screen creditor calls so that you only speak to creditors when you’re ready.

* Make sure you have a solid game plan for building up money to settle with, and set the funds aside in a separate bank account.

* Do not send settlement funds until you have the deal in writing. No exceptions!

* After paying the settlement, follow up to obtain a zero balance letter from the creditor, so you don’t have bogus collection problems later on.

* Know your rights as a consumer by reading the free resource articles on debt, credit, and collections at the Federal Trade Commission website:

* Don’t be intimidated or pressured into accepting a settlement deal that you can’t handle.

Remember, thousands of people settle their own debts every year, without the need for lawyers or bankruptcy. You can do it too if you’re disciplined, determined, and prepared to ignore some of the crazy stuff that bill collectors say. When you’re finally debt-free, you’ll feel a lot better about having worked it out on your own. Good luck on your road to debt freedom!

Point and Click to Your Financial Plan


You’ve organized the contents of that bulging shoebox and tracked down the stray receipts lurking in jacket pockets. Now you’re ready to point and click your way to what you hope will be a generous tax refund.

Point and Click to Your Financial Plan

You’ve organized the contents of that bulging shoebox and tracked down the stray receipts lurking in jacket pockets. Now you’re ready to point and click your way to what you hope will be a generous tax refund.

But while your records are still organized and your computer’s still on, why not look beyond that refund to your financial future?

Using do-it-yourself online financial tools, planning ahead is easier and more convenient than you may think.

“The purpose of creating a financial plan is to define what you hope to achieve in terms of financial success,” says Peter J. Rossi, director of financial planning for NetBank. “If you take the time to write down what you want to achieve, you’re much more likely to achieve it.”

For NetBank customers, it’s as easy as clicking on your mouse.

The bank’s online interactive planning tools include an Express Planner that provides an overview of the customer’s current finances; plans for specific goals, like retirement, education and insurance; and a Comprehensive Planner that integrates all the others for setting multiple goals.

In addition, the bank offers access to brokerage services and other investment and insurance products.

Dedicated financial advisers are available to help analyze the plan, answer any questions and help put the plan into action.

Financial planning isn’t just for people with excess wealth. Financial planners recommend that everyone have a plan in place for their financial future.

The experts at NetBank recommend taking control of spending by tracking expenses over two to three months. After you get a clear idea of your expenses, develop a plan to spend less and save more.

For instance, you could consolidate your high-interest debt by refinancing your home or getting a home equity credit line.

They also suggest reviewing the asset allocation in your investment portfolio to confirm that it’s in alignment with your goals. And make sure your insurance coverage is enough for your financial position.

With an online plan, you can complete it on your own time and update it as often as you like.

Retirement Worries? Imagine Double Your Investment in 2006…


After having spent the last three years or so building up a $6Million property empire in the UK from a standing start, property millionaire investors Geoff and Jane Morris turn their sights on the still sizzling Florida property market.

Orlando villas for sale, Orlando homes for Sale, orlando vacation rental homes, real estate investing, double digit growth

Copyright 2006 Geoff Morris

In a joint venture that encompasses several major property developers, as well as leading Internet marketing guru Kirt Christensen, and one of the USA’s leading Motivational Coaches ‘Dr Stan Harris’, Property Horizons kick off their latest Florida venture with a tele-seminar to be held early in January.

If the prospect of generating a return on your investment that will approach – or even exceed – 100% excites you, then you really must have a look in more detail about the deal the joint venture is planning.

Starting with the initial teleseminar in early January, these will be followed up every month with at least two more exciting property opportunities. Every three months they will be planning live seminars in Orlando, where both new and resale opportunities will be on display.

The people involved in this promotion have all been selected carefully, to ensure that fun and profit are combined in this competitive but extremely rewarding area of real estate investing.

The Realtor group selected specializes in identifying major developments across Florida, and have the clout to pass on huge savings and other advantages to their prospects.

Kirt Christensen, a leading Internet Marketer, used his expertise to buy a diamond marketing company a couple of years ago, did his magic and sold it for an ABSOLUTE FORTUNE, so he is used to identifying bargains, and ‘spreading the word’ very effectively.

Dr Stan Harris is one of the USA’s leading Motivational Coaches (Watch him smash through 7 concrete lintels with his bare hands – keep HIM away from your property). Although real estate investing is serious business, sometimes it is great to have somebody to help you overcome the inner doubts that can occasionally stop you from achieving your true potential.

Although the property market has its ups and downs, if you look at markets world-wide, there is a sort of ‘Mexican Wave?effect sweeping the Globe. What we mean by this is that as one economy is bubbling, and house prices rising, another is static, another is falling?so the secret is to be able to buy on the downward spiral, and sell on the crest in the next market. Timing can be so critical, especially if you are looking to at least see a consolidation in the equity you have in your property, not that you should consider property investing a short-term affair.

At the moment, properties in Florida and Georgia are still on the up in the right areas, so the end game is to have as many new property millionaires as possible created based on these high growth areas – you never know – you could soon be on YOUR way to your first (or next) million

What Are Bad Credit Personal Loans


Bad Credit Personal Loans have not only been designed to provide consumers with a personal loan despite their bad credit issues but these loans can also help you to get your credit back in good standing.

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Bad Credit Personal Loans have not only been designed to provide consumers with a personal loan despite their bad credit issues but these loans can also help you to get your credit back in good standing. Personal loans for people with bad credit can be used for any (personal) purpose and you can usually get your money in hand faster than a regular loan.

With the on-line availability of these types of loans you can avoid the hassles of going to different loan institutions when comparing personal loans. It is pretty easy with the aid of the internet, you can apply safely online at literally 100’s of lender websites. The interest rate charged by personal loan lenders may very depending on the type of bad credit personal loan you choose.

Secured Personal Loans

Secured bad credit personal loans are probably going to be the best choice because they can be taken on any amount (depending on your collateral) and their approval time is usually quite fast. Two choices for personal loans for bad credit are: one offers you fixed interest rate and the other, variable interest rates. Secured bad credit personal loans are usually easier to obtain than unsecured, if you have bad credit. The market for secured personal loans is getting larger every day. The rates of interest on secured loans are getting lower and lower because of the increase in the number of lenders and if you shop around you can find some incredible deals.

Unsecured Personal Loans

The Unsecured type of bad credit personal loans usually come with a much higher interest rate than what you can get with secured bad credit loans. The best part with bad credit unsecured personal loans is that you don’t have to put up collateral (your house or car etc…) and be at risk of being repossessed if something happens and you default on the loan. The better your credit rating is, the better interest rates you will be getting for bad credit personal loans.

Why You Should Get Involved With Commercial Real Estate


Learn the major advantages of commercial real estate!

commercial real estate, real estate, investments

The benefits of commercial real estate greatly outweigh the costs. In fact, I would say that commercial real estate is the best industry to be involved with because of the profits that can be made, as well as the fun nature of the work.

There are many who feel that commercial real estate is greatly out of their league, but this couldn’t be the further from the truth! Commercial real estate is accessible to everyone who is willing to learn about a new industry and reap benefits no other industry can offer. Below you will find the best reasons why you should get involved with commercial real estate. It is truly the best kept secret of those already succeeding or just starting out.

Let’s look at the many advantages of commercial real estate.

The first, and probably the most enticing benefit of commercial real estate, is profit. Huge profits, in fact, which can be made with a limited amount of effort. You can make the same amount of money quick turning or selling 100 single family residences as you would make with a single commercial real estate deal. The profits can be astonishing!

It takes the same amount of work for every commercial real estate deal, meaning you must go through the same processes each time. Why not maximize your results and go for the larger returning deals, rather than the smaller ones? Synergy is a key word in commercial real estate, as small changes can yield huge results.

Another great benefit of commercial real estate is you can work full or part-time, depending on your individual situation! Commercial real estate can easily be a part-time job that brings in incremental cash flow. You can even start out part-time, and hold a job until you have enough cash flow and money so that, eventually, all you do is commercial real estate.

Commercial real estate as a full-time job allows you to have many benefits such as being your own boss and having the ability to work from home. You can create your very own commercial real estate business and quickly build a strong net worth as well as positive cash flow.

In commercial real estate, your financial investment is very low, perhaps even non-existent. You can purchase property with 100% of other people’s money (OPM), and create large profits for yourself. This is the only industry where there are literally hundreds of millions of dollars just waiting to be borrowed! Find the money and get to investing!

Commercial real estate is an industry of abundance, not one of limits. In fact, there is very little competition because there is always commercial property becoming available. There is more than enough for everyone, which allows every person to have their opportunity to succeed in this business.

Another great benefit is that you can start right now, today! It does not take years of training or years of moving up the corporate ladder to be successful. You can begin your commercial real estate endeavors whenever you so desire because there are very few barriers of entry to this industry.

Finally, the greatest benefit I think commercial real estate has to offer is freedom. When you become involved with commercial real estate you have the freedom to do as you please. When you are not stressed about making rent, or finding your next job, life can be enjoyed to the fullest.

Commercial real estate can give you financial and personal freedom that, otherwise, would be wrapped up in a 9-5 job and someone else telling you where you have to be and at what time. For you already successful professionals and business owners, commercial real estate can be a great way to build wealth and equity quickly, without much time investment and headache! It is a great alternative to other types of investments that return 1/100th of what commercial real estate can return!

No matter what business, job, or current occupation in which you are involved, no other industry can supply you with the ability to be in charge of your very own life and create a lifestyle that best fits you and your personality.

It is truly amazing how people’s lives drastically change with only a few income producing properties in their portfolio. I urge you to delve further into this industry and get excited about it! Commercial real estate is a sound, extremely profitable, extremely doable, tried and true business that will always be available to those wanting the benefits commercial real estate has to offer.

How To Get Free Stuff


Most of us would like to get free stuff, but what is really free anymore? Actually, many things, and here are a few to get you started.

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You really can get free stuff, but yes, sometimes there are strings attached. For example, when we were at universal studios I got a free backpack. The catch? I spent six minutes filling out a credit card application. On the other hand, we ate pretty well on free sample days at local food stores when we lived in Tucson, and there really weren’t any strings attached, other than the risk of being sold a delicious new food. Check ut the easy freebies that follow.

Free Entertainment

Many libraries carry movies on DVD, and most at least have documentaries. We ‘ve even seen music videos on DVD in one library. The only cost? The time to get a library card.

Want free concerts? Festivals usually have some free musical entertainment. For example, the National Cherry Festival in Traverse City, Michigan has free entertainment every night during the week-long festival, including many recognizable bands and (often) a Beatles tribute band. Go to Google and type in “festival” and the name of towns around you to find these freebies.

Free Vacations

In Hawaii, Costa Rica or Colorado, someone is just waiting for you to come and stay in their house while they are away. You may have to water the plants, and even get the mail for them, but you get to stay in a beautiful home in a sunny place. Sometimes you even get paid for these vacations. The only catch is that to find these opportunities, you may have to subscribe to one of the newsletters that list them.

We camped for ten days in our van, at Williams Landing, east of Tallahassee, Florida, on Lake Talquin. It’s a beautiful place, and even has hot showers. Our cost? Zero – and you can stay up to two weeks. There are many free campgrounds scattered around the country. To find them, buy a Woodall’s directory from any large RV dealer. Camping can be an essentially free vacation if done right, because you may spend less than if you stayed home.

More Ways To Get Free Stuff

Many states give away free road maps. Some also give away free legal forms, like statutory wills. Check the state’s online sites.

You can get free dental x-rays at some dental colleges. Be patient, as the students are just learning, but an experienced technician is always with them. When done, you’ll get the x-rays to take to your own dentist, which can save you $30 to $80. Some schools charge a small fee, but is always less than the regular cost.

Many utility companies offer free “energy audits.” They’ll come to your home and find the places where you are wasting energy. Some even han out free kits for caulking windows and weather-stripping doors. call and ask.

Want free, confidential business advice from a business expert? Go to the website of “SCORE” (Service Corps of Retired Executives). These are successful business executives who volunteer time to help others in business.

Some restaurants will give you a free dinner on your birthday. Others give a free birthday cake. Bars will often buy your first drink for you if it’s your birthday. How do you find the ones that do this? The way you always discover how to get free stuff – just ask.

Bargain Finder Secrets


How do some people find all the deals? The same way you will once you know the bargain finder secrets. Here is one secret to get you started.

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Want to be a bargain finder? Want to be the one that always finds the deals and has money left over? Start by learning the secrets of opportunism.

Do you know that you can eat a wider variety of fruit than your neighbor, and spend only half as much to do so? How? By buying fruit in season, when it is at the lowest price. As a bonus, it is also of the highest quality at these times. This is opportunism.

Notice that this means not always getting exactly what you want when you want it. You get more variety this way, and you spend much less, but you go with the flow. If oranges are cheap, you’ll be eating oranges. If apples are in season, you’ll be eating apples. Whatever the case, you’ll always be finding bargains.

You never have to eat things you don’t like or deny yourself pleasure. You just shop for those things that you like among those that are cheaper now. There will be other, different, great deals next week or next month. Unless you are extremely picky about what you eat, you’ll almost always find delicious foods that you like on sale.

That’s the premise of opportunism – that you get more by going with the flow. A true bargain finder gets more variety in the long run, and more for the money. This can be applied to many areas of life.

Bargain Finder Examples

When I went to Ecuador a few years ago, there were many interesting places I wanted to go. I chose Ecuador because it was a thousand dollars less to go there than to any other country. I had a fantastic time for a month for $1040 (including airfare). I also met the most wonderful woman I know there, and eventually married her, so you never know what riches you’ll find when you go with the flow.

We go to the movies here in Tucson on Tuesdays, when we can get in for $2.00 each. Others are paying $8.75 a couple miles away. What are they getting by paying four times as much? They get to see the movie six weeks earlier. The movies don’t change in those six weeks, by the way, and enough friends have seen them by then to let us know if they’re good or not.

Opportunism means not paying more unless you are getting more. It also means making honest choices. Will you actually enjoy that movie more by seeing it now? More than you’ll enjoy the FOUR movies you can see in it’s place? Do you have to take that fishing trip now? If you’re planning to take both a fishing trip and a gambling trip, why not do each when it’s cheapest?

When William Danko and Thomas Stanley wrote “The Millionaire Next Door,” they found that MOST millionaires bought used cars. They bought BMWs and Mercedes, not old Ford Pintos, but the lesson was clear: They understand opportunity. Cars often lose half of their value in the first three years, but they’re not half used-up, are they? Is it worth an extra $6,000 to say you have a new car (And you will have to tell people, since it’s hard to tell a three-year-old car from a new one)?

To be an opportunist doesn’t mean just settling for whatever is easy and cheap to get in life. We all have our areas that are more important to us. If you really love those $15 cigars, why not buy them? On the other hand, if you really can’t tell the difference between the $5 and $50 wine, why not buy the former? Opportunism is one of the keys to being a true bargain finder.

Where Did My Paycheck Go?


The typical scenario is that you get your paycheck. After you recover from the shock at how little is left after taxes, you proceed to divvy it up among all your outstanding bills, intending to put whatever is left over into your savings.

But there never seems to be anything left over and your savings don’t grow.

A better plan would be to pay yourself first. Don’t let the money get into your hands.
You might find that you actually begin to grow your savings much quicke…

debt reduction, saving and investment, financial planning

The typical scenario is that you get your paycheck. After you recover from the shock at how little is left after taxes, you proceed to divvy it up among all your outstanding bills, intending to put whatever is left over into your savings.

But there never seems to be anything left over and your savings don’t grow.

A better plan would be to pay yourself first. Don’t let the money get into your hands.
You might find that you actually begin to grow your savings much quicker this way.

If you work for an employer with a 401K plan, the first thing you should do is to fund it to the max. If you can’t afford that, at least put enough in to get the full matching contribution form your employer.

This investment is made before taxes. Your investment is larger and with the employers contribution grows quickly.

Next have a brokerage or mutual fund company debit your banking account monthly. This money should first go into an IRA ?if you have five years or more to go to retirement, make it a Roth IRA.

Next have a few dollars more be debited to go into a no-load, low cost mutual fund. The younger you are, the more aggressive your choice of fund can be.

After that is done, then figure out how to pay your bills and living expenses. If money is tight, cut back on your living expenses and use the extra money to pay down your debt.

Start with the lowest balance first. Once that debt is paid, take the amount of money you were paying on that debt and add it to the payment on the next lowest balance debt. Continue doing this and you can be totally debt free within 5 to 7 years.

Another version of this method is paying the highest interest rate debt first. The principal is the same, you just see more progress with the first method, although it could be more costly based on how your debt is distributed.

(If you don’t believe me, get the premier version of Microsoft Money or Quicken and use the “Debt Reduction?module. You will be shocked at how much money you will save and how fast you can eliminate debt this way.)

The idea is to scrimp at the expense of your current lifestyle, while leaving your savings to grow and you debt to shrink.

I know many of the people reading this will scream that this is an impossible plan.
But it is quite doable with a little will power and the ability to delay gratification for a while.

The problem is that if you don’t do this, your future might turn out to be very bleak.