Be Carefull of the Economic Help Rip Offs

I have seen a number of late night scams on TV to help people solve their economic problems. We should all ask ourselves the question: if it looks to good to be true, it usually is.

When I see these infomercial about fixing your credit report, I ask the question, is this too good to be true. Doesn't our credit score simply record or document what has and is going on with our credit, good or bad. These companies promise to fix or repair your credit for a fee. Run, don't walk away. Never send them money and never give anyone access to your bank accounts. For a fee, these companies will bombard your creditors with letters to cause confusion. If your credit report has incorrect or inaccurate information on it, you can send them a letter on your own and they have to make the appropriate correction to your report. If something on you report is negative but correct, it cannot be eliminated. Only time will remove any negative activities from your report. No one can take off accurate negative information. Keep doing good stuff like paying off old debt on time and put money in saving just in case you have an emergency. This way you can use cash and not use a credit cards when things happens.

Next are the people who can negotiate with the IRS and get you great settlements. Well, the IRS is the IRS and they get their money no matter what. The IRS will only accept an OIC (offer in compromise) if you a) have no income, b) have no asserts and c) have no future of income or asserts. The IRS wants you to file bankruptcy because you can't include them in the bankruptcy and they will get their money including interest and fees. They have leverage on their side. Do not send these people the $6K to $10K to help you. They simply do not deliver as advertised.

Next are the people who promise you that they will negotiate with your creditors and get you a reduced offer. First they will get a large fee from you up front. Second they will have you delay paying your creditors or they will have you make your payment to the consumer creid counseling agency and they will stop paying your creditors. Fees will start to increase on your accounts. Once they have taken their fees and piled up some of your cash, they will try to offer the creditor a lesser amount. These actions are dishonest, deceitful and unethical. Most of the time these efforts will not work. You will pay more in the long run and your credit will be ruined. Don't do it. Again on your own, you can find ways to pile up some cash and offer your creditor a discounted amount. Also you can and should always call your creditor and ask for a better/lower interest rate. And as always, stop using credit. (check out your credit report at http://www.annualcreditreport.com/)




Last but not least are the consumer credit counselors who will handle your credit payments for you for a small monthly fee of $25 a month plus and an up front fee. You send them your money and they will negotiate with your creditors for longer payment term and lower interest rates. This usually take 24 to 36 months to complete. Remember, when you pay longer, you pay more in almost all cases. Again, you have the power to call or write your creditor to negotiate with them to pay the debt you have incurred.

Most people who decide to get our of debt and stay our of debt, stop using credit and have a written budget. The average person can get out of credit card debt in 18 months or less by stop using credit and using all their extra recourse to pay off this debt. Each of these rip offs cost money and do not produce result but the biggest problem is that they do not address the problem of changing our spending habits. It is like getting liposuction to loose weight and still eating Oreos and nacho every day while not getting exercise. We all need to change our habits and live on what we make and stop looking for easy ways to take care of the problems we have caused. There is no bail out for the average guy coming from Washinton. The light you might see is a truck wanting more of your money.

Lets be different and live on less that we make.


Check out the video.


http://www.hulu.com/watch/1389/saturday-night-live-dont-buy-stuf





Dave Williams

www.lighthousefinancialcounseling.com