DEBT OPTIONS

Debt consolidation may work well for clients with substantial equity in their home and solid credit ratings; unfortunately this is not true of many of the US consumers who owe the $2.1 trillion in unsecured debt. Additionally, for those who do qualify for a debt consolidation loan, a lower interest rate comes at the expense of converting unsecured debt into secured by a home or a car. Now if the borrower can’t pay their bills, the creditor can come and take their property away from them.

The main problem with CCC organizations is that they are not working for the client; they are WORKING FOR THE CREDIT CARD COMPANIES. This may seem unbelievable, but it is true. Most CCC agencies are alleged non-profit organizations that claim to be independent. But in fact, these non-profit organizations are funded and supported by the very people you owe money to – the credit card companies! That is why CCC companies are not able to reduce the amount of debt a client owes. They merely derive a solution that keeps the client paying their credit card bills despite financial hardship.

In addition, many large CCC companies have been the subject of major lawsuits, and the IRS has begun retracting non-profit statuses and is not granting any more non-profit status to credit counseling firms. D-One, by design, receives no payments from its clients’ creditors, which allows D-One’s incentives to perfectly align with our client base – saving the client the most money. This allows D-One to provide a client with (i) lower monthly payments; (ii) a shorter program; and (iii) the maximum savings.

Bankruptcy is a way for a client to potentially get out of their debts. Unfortunately, it leaves a long lasting scar, and comes at a high price – financially, emotionally, and socially. It can be a long and painful process and the repercussions can last for over a decade. The financial impact is severe; a bankruptcy will stay on a client’s credit report for 10 years. Every time the client applies for credit, whether it is a home, a car, a lease, or insurance, they could be impacted. The long-term effect of higher rates can greatly outweigh the shorter-term impact of filling bankruptcy.

Additionally, most people do not realize that bankruptcy can stay on their court records for up to 20 years – which means it can follow someone for the rest of his/her life. If one applies for a job, a loan, rent an apartment, or even insurance, their bankruptcy filing could be easily uncovered. With the new bankruptcy reform bill, it has become even tougher to declare Chapter 7 bankruptcy. A quick note the Q1 2006 personal bankruptcy filings declined by 70% as soon as this reform bill came out.

Sadly, this is the choice for millions of Americans who are struggling with their debts. Most of these people keep doing whatever they can to continue making minimum payments for the rest of their lives. This is a no win situation. If a client with financial hardships keeps making their minimum payments, they will be paying mostly interest and will remain in debt for as long as 20-30 years. If the client can’t keep making the payments they can end up with potential judgments and garnished wages as well as liens against their property.