Ads appear all over the internet: Debt consolidation! Don't declare bankruptcy! Your bankruptcy alternative! In the wake of a suffering economy, debt consolidation companies are popping up all over the country, promising to reduce your payments and free you from debt.
But to what are you really agreeing with debt consolidation companies?
- Unfortunately, some of these programs are scams. Beware of a company that asks for your banking information and does not offer credit counseling before you start.
- While these companies can renegotiate the interest on your credit cards or loans, they cannot stop you from losing your assets. Only an Arkansas bankruptcy attorney can protect your belongings when debt collectors start calling in their loans.
- Most of these companies charge outrageous fees, and often a substantially increased "first payment," which leaves you with more debt than you had to start.
- Most of the "insider information" that you receive from them is merely good money management strategy, such as eliminating extra expenses, setting goals, and finding ways to bring in extra income. Of course, these companies will charge you for this common sense.
- They offer to call your lenders and negotiate with them to reduce your fees so that you pay back less interest. Most people don't know that they can also do this with the help of a debt settlement attorney, which includes the added security of protected assets and the possibility of greater reduction in debt.
- A lot of these companies require payments for several months before they even start calling your creditors to negotiate. By so doing, the money you put in has time to earn interest in their accounts. Wouldn't you rather have people working for you the minute they're hired?
- When your debt is refinanced, your monthly payments may be lower. However, they are often negotiated for a longer period of time. You end up paying less now, but that does not mean you save money if you will be paying more interest for another five, ten, or fifteen years.
- It may be appealing to make one payment to the debt consolidation company to avoid the hassle of writing several checks a month. But if the smaller loans are renegotiated at a lump sum rate, you're essentially trading one loan for another.
- Debt consolidation counselors are paid to tell you that debt settlement is the right thing for you. They will not tell you if declaring bankruptcy will actually save you more money, because they would have nothing to gain. An experienced Arkansas debt relief lawyer can tell you your best option, because he's working for you.
Discover the difference between debt consolidation scams and actual debt relief-and how quickly you can get back on your feet. Call Butler, Horn, Nye & Johnson today at (501) 315-5297 to get the truth about your debt management options.
We proudly serve clients located in Central Arkansas including: Benton, Bryant, Conway, Little Rock, North Little Rock, Russellville, Hot Springs, Cabot, Searcy, Jacksonville, Malvern, Arkadelphia, Sheridan, Sherwood, Maumelle, Mayflower, Pine Bluff, and all cities surrounding Saline, Pulaski, Grant, Garland, Hot Spring, Perry, Conway, Faulkner, Pope, White, Clark, Lonoke and Jefferson Counties.