Bankruptcy

Better Than Bankruptcy? Look Out For These Scams!

There’s such a stigma about filing for bankruptcy that often, I find, very smart people get bamboozled by crooks promising a way out of filing. Remember the adage: If it sounds too good to be true, it probably is. And if you’re in financial distress, any offer of help can sound like a choir of angels. But it’s precisely at that point that you need your wits about you, and a healthy dose of skepticism to boot.

This article from MSN’s Consumer Man series will open your eyes. It recounts the story of Carol, a woman from North Carolina who didn’t want her last name given. Carol believed the promises made to her by a woman who called offering debt relief. She’d get her interest rates lowered. She’d pay off her debt in 3 to 5 years, as opposed to 30 or so she might have otherwise needed. It sounded so good, in fact that Carol was moved to tears. She signed up and sent her $499. But the debt relief promised never materialized, and now Carol’s out that $499 (the firm won’t return it), and as for the debt relief firm? It’s defending a suit brought by the Federal Trade Commission.

Don’t let your guard down. No one - literally, no one - has any kind of special “in” with your creditors. If you’ve tried to renegotiate your terms (and you should), and were unsuccessful, then move on to consider other alternatives. Credit counseling - real credit counseling, with an appropriate and well-respected nonprofit organization (and here’s a hint: not all nonprofits are well-respected) - might be one answer. Filing for bankruptcy might be another. If you think you’re there, speak with a lawyer today.

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