- 5491 N Milwaukee Ave
Chicago, IL 60630
Disclaimer:(1) I am a licensed IL attorney & debt relief agent. I help people get out of debt through bankruptcy, lawsuit defense, and negotiated settlements.
(2) This website is an advertisement for legal services to IL residents only.
(3) The information on this website is for general educational purposes only. It is not specific legal advice to you. Do not rely on it. See a licensed attorney before taking any action.
(4) An attorney-client relationship can only be formed by signing a written contract for representation.
National Association of Consumer Bankruptcy Attorneys
American Bankruptcy Institute
Better Business Bureau
If you ever tried to negotiate with your credit cards a reduction in your total debt, interest rate, or monthly payment, you know it’s darn near impossible. Sure, you may get one or two cards to give you a slight reduction in your payment for a few months, but that doesn’t solve anything.
You begin to ask. “Why won’t you work with me? I’ve been a loyal customer for years. Do you want me to stop paying?” But the credit card company still won’t budge. “We can close your credit card,” is the best they offer you. How will that help?
Frustrated, you search the internet for solutions and come across a “debt settlement program.”
REMEMBER WHAT YOUR PARENTS SAID ABOUT THINGS “TOO GOOD TO BE TRUE”
You’re amazed by the debt settlement company’s promises, which seem to imply that they can reduce your debt by 50% to 70% percent. “They must know something I don’t,” you tell yourself.
The debt settlement company’s name sounds legitimate; the word “law” may even appears in it. Their website looks legitimate. “Maybe it’s a government program,” you think.
It never crosses your mind that what you’re looking at is a scam. After all it’s an advertisement on the internet. “How can it not be true?” So you never bother to do a “Google” search to read the complaints. Worse yet, if you do a search, you ignore the countless warning signs, because you want to believe.
So you call the company and they tell you a story which almost always goes like this… “This will help you avoid Bankruptcy. We’ll contact your creditors and get them to stop bothering you. In the meantime, you’ll pay us every month and we’ll set aside this money in your settlement account. When it grows, we’ll negotiate with your creditors a settlement which reduces your debt by up to 70%.”
BUT YOU IGNORE YOUR PARENT’S ADVICE & JUMP IN
The debt settlement company’s offer sounds so good you don’t even bother to read their contract which takes back or waters down the promises you thought you were getting. You even ignore the fact that the company who advertised to you is not the same company you are being told to sign a contract with.
If you try to say “let me think about it,” get ready for the high pressure sales pitch. And if you still don’t sign up on the spot, get ready for the daily phone calls until you do!
So you sign up and begin to send the debt settlement program a monthly amount, which is often in the hundreds.
You sign a “power of attorney,” which requires your credit cards to stop contacting you. Little do you know that the real reason they had you sign the “power of attorney” was to keep you in the dark. That document prevents creditors from informing you that nothing is being paid and that you will be sued.
And for the first few months, there are no signs that anything is wrong. You don’t get phone calls or letters from your credit cards.
Often the debt settlement company will even settle your smallest account to make you think the program is working. But you forget that you gave them thousands and they only settled your $200.00 account.
“WHY AM I BEING SUED, I’M PAYING A DEBT SETTLEMENT COMPANY?”
But then, you get a lawsuit. Seems odd, so you call the debt settlement company. They reassure you that it’s all ok and that you should ignore the lawsuit because they’re taking care of it. “Just keep sending in your payments,” they tell you.
You believe them because you want to believe them. After all, you’ve paid them thousands of dollars. But the next thing you know your bank account is frozen and your wages are being garnished.
So you go see a real attorney who pulls your credit report and what you find is a shock.
Your credit report shows that your debts have been unpaid for months! As a result, your credit score is now in the tank and your other credit cards are also getting ready to sue you. Worse yet, you now owe more that you ever did before.
“But, how can that be? I’ve paid the debt settlement company thousands of dollars!!!”
You start to read the contract and realize why nothing ever got settled. There are layer upon layer of fees which prevented your settlement account from ever growing. Set up fees; monthly fees; maintenance fees; correspondence fees; telephone fees; negotiation fees; and the list goes on.
Then comes the kicker, the company won’t give you a refund; they won’t defend the lawsuits; they won’t return your calls; and, soon the company may no longer exist. You can’t find them anywhere.
OUTSIDE OF BANKRUPTCY, NO ONE CAN FORCE YOUR CREDIT CARDS TO SETTLE
You sink into your seat when the attorney tells you, “I’ve seen this countless times before. I’m sorry to break this to you, but it appears that you’ve been scammed.”
You go home in disbelief. You search the internet with the company’s name and now you begin to notice the countless complaints from other consumers. You start to see warnings from consumer advocates. You may even notice that several states’ attorney generals have sued the company.
You look for the “government programs” which the debt settlement company made you believe existed, but you find nothing.
Finally you accept the truth…. If your credit cards won’t settle with you, their “good, loyal, long term customer” they are not going to settle with anyone else unless they are forced to.
Bankruptcy works because there is a law in place which forces your credit cards to eliminate or reduce your debts. And if they don’t like it, that’s just too bad because the law is on your side.
When your case is done, you get a Court Order signed by a Federal Bankruptcy Judge. If your creditors try ignoring the Judge’s Order, they will soon be paying you!!!
So if you can’t pay your debts, don’t turn to debt settlement gimmicks which ultimately don’t work and will end up costing you thousands. Turn to the proven solution which has helped millions of hardworking Americans turn their lives around: bankruptcy.
Do yourself a favor and do some research so that you do not become another victim of a debt settlement scam.
A good tip when doing a “Google” search is to type the name of the debt settlement company followed by the words “complaints” or “scam.” However, be aware that it not unheard of for debt settlement companiesto change their name as a result of complaints or lawsuits.
And if you still want to believe the debt settlement company’s promises, read these articles from consumer advocates.
“Debt Settlement: Fraudulent, Abusive, & Deceptive Practices Poses Risk To Consumers.”
Author: US Government Accountability Office
“Should I use a debt settlement service to help me deal with my debt and debt collectors?”
Author: US Consumer Financial Protection Bureau
“The Debt Settlement Company Scam”
Author: Office of the Illinois Attorney General, Lisa Madigan
“An Investigation of Debt Settlement Companies: An Unsettling Business for Consumers”
Author: National Consumer Law Center
“Complaints to BBB Against Debt Settlement Companies on the Rise”
Author: Better Business Bureau