There is no legal right to debt reduction or credit negotiation if you owe more than $10,000. Any advertisement promoting credit card and debt reduction is misleading. I hear them all the time on TV and radio. I get spam ads on the internet. Have you heard the commercials?

• Do you know if you qualify for a personal rescue?
• If you have credit card debt of more than $10,000, you have the RIGHT to pay off that debt for a fraction of what you owe, with monthly payments you can afford.
• The credit card companies have received billions and they need to clean up their books once and for all and that’s great news for you.

Well, I’ve heard them too and spent some time researching. If I were being generous, I’d say the debt reduction claims are misleading, but I’m not, so I’ll call them lies. Each of those statements are demonstrably false. Congress passed the Credit Card Accountability and Liability Disclosure Act of 2009 or the Credit CARD Act of 2009. Have you looked at one of your credit card statements and noticed that it now tells you how much How long will it take you to pay off your credit card if you just make minimum payments? That’s a new requirement and a good idea, in my opinion. I took some time to review the Law. Nowhere does it establish that the consumer has the right to have the debt reduced if it is more than $10,000. It’s just not there. I’m not alone in calling them. The Federal Trade Commission on its website notes that:

There is also no guarantee that a creditor will accept partial payment of a legitimate debt. In fact, if you stop making payments on a credit card, late fees and interest are typically added to the debt each month.

I have literally dozens of clients who have hired me after trying one of these debt negotiators. The stories are all the same. They are told not to hire a lawyer and to stop making their credit card payments and start making payments to the debt negotiator. When the credit card sues for non-payment, the client calls the debt negotiator, who tells them that they are not lawyers and that the client needs to hire one. What?! I thought they didn’t need a lawyer. These dealers charge too much, do too little, hide the facts, and mislead the consumer. I feel really bad for the clients that have hired me after using a debt negotiator.

Most people really try to pay creditors and just seek help. They believe the debt negotiator because they want to believe that this is a realistic option only to find out that they are being taken advantage of. It’s a shame because there is help for someone overwhelmed with debt, but not with these negotiators. We do not negotiate debt. We eliminate debt. I don’t call a creditor and ask if they would consider a payment plan or if they would be interest free for a while. We use the powerful bankruptcy laws to put you on an equal footing with a creditor, without the need for negotiation.

For more information on bankruptcy, please take some time to visit my website at: Downdriver Bankruptcy.