Why Most Debt Elimination Programs Are a Waste of Money

Perhaps you've seen ads for "total debt elimination" and wondered what it is. Well, never forget the old saw: "If it sounds too good to be true, it probably is." That's certainly the case here ? the kind of debt elimination where slick sales copy or a fast-talking salesman contends you don't really owe your credit card debts is quite simply a scam designed to part unwary, gullible consumers from their hard-earned cash.
Credit card debt is paralyzing millions of Americans today and sadly, thousands fall prey annually to scammers promising they possess a "secret legal loophole" that forces creditors to forgive their debts without repayment. The so-called secret is special wording used in letters that consumers send to their credit card banks disputing their bills. Of course, the price of these "secret words" is often quite steep, with fees up to $5,000 or more.
Before you trust anyone but a bankruptcy lawyer to help you erase your debts, please do a little research. You will find this "no money lent" method not only doesn't work, it backfires badly. Creditors have all seen these letters before and react swiftly and harshly to this ridiculous tactic. Think about it for a moment ? the economy would collapse if this "secret" were legitimate!
So instead of using what little money you had to pay off your debts, you've thrown away hundreds or thousands of dollars to learn a bogus "secret," and now all of your creditors are suing you. You've only made a very bad situation worse, requiring legal representation for repeated court appearances with your various creditors' attorneys. This translates into potential wage garnishment, repossession of vehicles, foreclosure, i.e., a laundry list of financial disasters for the desperate debtor. Great results, right? Then why do so many people fall prey to this scam?
Probably one of the main reasons is a popular method used to promote it ? MLM, or multi-level marketing. Often a friend, neighbor or relative will approach you with a sensational-sounding "amazing discovery of a foolproof method of totally eliminating their debts" and want to share it with you before the price goes up/the Feds crack down/etc., etc. The only amazing aspect of this is how many normally intelligent people fall for the outrageous hype.
Here's the plain truth. Legitimate debt elimination involves payment in full (on your own or via credit counseling and debt consolidation programs), bankruptcy (increasingly difficult since new bankruptcy legislation was passed in October 2005), or haggling with your creditors to reduce the balances due by 50% or more (debt settlement). Which option is best for you depends on your financial situation. In other words, true debt elimination IS possible. You just have to use the right approach. Don't be fooled by the scams and be sure to thoroughly research any company you do business with before signing a contract or paying any fees.
Charles J. Phelan has been helping consumers become debt-free without bankruptcy since 1997. A former senior executive with one of the nation's largest debt settlement firms, he is the author of the Debt Elimination Success Seminar?, a five-hour audio-CD course that teaches consumers how to choose between debt program options based on their financial situation. The course focuses on comprehensive instruction in do-it-yourself debt negotiation & settlement designed to save $1,000s. Personal coaching and follow-up support is included. Achieves the same results as professional firms for a tiny fraction of the cost. Visit http://www.zipdebt.com/debt-settlement-coaching.php for more information.

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