Debt consolidation company insisted I stop making payments on my credit cards?
asimmonz asked:
I signed up with ABC Debt Relief and they told me that even though they couldn’t tell me to stop making payments, they did recommend that. I have never been late on any C.C. payments. They said that once I stop making payments, the C.C. companies will try to get me to pay throughout the next 6 months or so. But after a while, they will put me in “collections” status and are then ready to negotiate a settlement which they say I can cut down 40% of all my debt. Does this sound too good to be true? Or, am I getting douped into punishing my credit score for the next decade?
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I signed up with ABC Debt Relief and they told me that even though they couldn’t tell me to stop making payments, they did recommend that. I have never been late on any C.C. payments. They said that once I stop making payments, the C.C. companies will try to get me to pay throughout the next 6 months or so. But after a while, they will put me in “collections” status and are then ready to negotiate a settlement which they say I can cut down 40% of all my debt. Does this sound too good to be true? Or, am I getting douped into punishing my credit score for the next decade?
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Tags: Credit Cards, Credit Score, Debt Relief
February 22nd, 2009 at 10:58 pm
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Yes, and yes.
Your credit will be damaged. You’ll pay higher interest into the forseeable future but your life will go on. Decide the best business decision for you!
Is the short-term condition in which you find yourself crippling or can you cut back on lunches out and consolidate tasks that require driving, forego the drycleaner, etc., and pay your cards off (one at a time until the balances are gone)?
If you cannot find another way out of your current circumstances, then debt negotiation may be the way to go.