Why Debt Settlement Companies Do NOT Work!
Now, more than ever, people are financial stressed and are in seeking a way out of the financial situation they feel trapped in. In swoop the debt settlement companies. These companies engage in tactics that deceive and mislead people about what they do. They deceive and mislead people about how much they charge. Moreover, they deceive and mislead people about what powers they have. Ultimately, these companies make empty promises and pray on people during their most financially vulnerable time. In short, debt settlement doesn’t work!
Four Reasons Why Debt Settlement / Debt Consolidation Does NOT Work:
- First, debt settlement companies will NOT “settled” all debt.
- Secondly, not every company will work with a debt settlement firm. This is a fact they will not bring to your attention. Many debtors find out that hard way that a growing number of creditors refuse to negotiate. One example is Discover – Discover never participates.
- Thirdly, creditors are NOT required to settle debt with people who legitimately owe them money. Overall, if a creditor chooses, they can pursue the debtor for every last penny that he/she owes. Not even the statute of limitations can stop a creditor from pursuing a debtor for payment. The expiration of the statue of limitation only stops creditors from filing a lawsuit in their efforts to collect on the debt.
- Lastly, the IRS treats forgiven debt as income. That means if a debt settlement company was somehow miraculously able to settle your $30,000 debt for $15,000, you would need to pay taxes to the IRS on the forgiven debt (i.e. $15,000). A bankruptcy does not result in you having to pay taxes to the IRS.
Contact Attorney Jason P. Provinzano, 570-822-JPP1, for a free consultation to learn the truth about bankruptcy.
