Debt Relief, Credit Card Debt Attorneys and the High Cost of Bankruptcy - The Truth About Collection


Look, we get it: your credit card debt is overwhelming, you're perhaps inundated with calls from creditors, and certainly you're feeling the burden of your debt obligations like an albatross around your neck. This, in theory, is just what Chapter 7 bankruptcy is designed for: getting you out from under the heap. However, a number of new laws have made this kind of credit relief all but impossible, and even simply unworkable: sad to say, for Chapter 7 bankruptcy laws to truly help you out, even under the aegis of the most qualified of credit card debt attorneys, you pretty much have to be homeless.

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Most mainstream American families are more likely to be hurt than helped by Chapter 7 bankruptcy as a means of clearing out credit card debt. In particular, American families who have just simply run into a short stretch of bad luck, or those who've gotten caught up in poor spending habits, should actually try to avoid any kind of governmental protection because of the severe consequences and court costs required, including in particular the expertise that only enlisting credit card attorneys can guarantee.

This is not to say that Chapter 7 bankruptcy could not be instrumental toward strategizing debt relief for you and your household. For example, settlement negotiation specialists prefer to employ the Chapter 7 card as climactic master stroke during toe-to-toe bartering on behalf of their clients about how high the percentage of credit card debt will be for any start-up loans, in consideration of how much you will be willing or able to pay. In the end, it may be that you are able to settle your debts for a fraction of the amount due, just so as the collecting company can get your debt off their books. As a consequence, the debt settlement counselors will likely be insistent that you refrain from even passing communications with your creditor's office. Also, try to screen your calls as much as possible. Heck: lie about your name, if you need to, when collectors come calling. (No on said this advice is pretty-merely necessary.)

You should keep in mind, though, that your lending institution will likely be well within their rights-and well within the federal statute of limitations-if they decided to force a settlement judgment through aggressive litigation. Most banks will try to avoid this, though, because of the legal costs and the bad public relations situation caused by aggressive collections. The cost of credit card debt attorneys for these types of proceedings are almost always greater than the amount that the corporations might stand to lose if you don't end up paying the funds owed, especially since a large number of state judiciaries are becoming less and less likely to automatically find in favor of the plaintiff (i.e., your bill collector) when cases actually go to court. Not to mention that most financing companies are all too aware that many defendants will end up immediately filing for Chapter 7 bankruptcy (and thus getting rid of any chance that the company will collect on its debts) if the judgment against a debtor is too harsh or too unreasonable; most companies would much rather receive some money than none, even if this means that they will never collect on the full amount of the debt.

The smart rule of thumb to follow is simply to pay attention to interest rates and transaction fees. For example, any unsecured debts you may have that have only been recently discharged by the initial creditor of record - and that have not been previously purchased by any other bill collector - would still cost the new lender less than a total of eight cents per dollar. Depending upon the size of the loan you take out, and on your your immediate liquidity, you may even get this ratio to the ratio could fall to five or six cents a buck.


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