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Debt Settlement is Like an Onion. What You Need to Know About the Five Types of Debt Settlement.

Debt settlement is not a monolithic debt relief solution. I like to say debt settlement is like an onion. It has layers.

There are several forms of tackling your debt using settlement. All are distinctly different, and understanding the differences is important to make the best choices for you and your situation.

For example, you could listen to someone on Facebook tell you what you should do to settle your debt. You might buy a book and try to learn how to do it yourself, or you might contact a mass market debt settlement company and get pitched some one-size-fits-none product. There are more variations.

In this Debt Free Dudes podcast, Damon Day and I talk about how each option has traps or advantages.

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Automated Transcript

Don’t blame me for errors; a machine did this.

00:00:00.017 –> 00:00:10.207
Hey, so Steve Rhode, you’re get out of debt guy from get out of debt dot org this week we’re talking about debt settlement more specifically how debt settlement is like an onion.

00:00:10.487 –> 00:00:14.937
You know, it’s got layers, all onions have layers, debt settlement has layers.

00:00:14.947 –> 00:00:25.007
Damon’s with me, this is debt free dudes, our podcast where Damon and I talk about debt subjects, you know the podcast that you love, that’s the one Damon.

00:00:25.017 –> 00:00:33.097
One of the things that’s been driving me crazy is when people come to the site, my site and they post something and then they say something about debt settlement.

00:00:33.107 –> 00:00:37.947
The problem is it’s one of those terms that can mean like five different things.

00:00:37.947 –> 00:00:45.537
So here here are the different variations I wrote down and let me know if you think of something different when people think about debt settlement, you have,

00:00:45.717 –> 00:00:53.067
the facebook forum advisors that just say you need to do that settlement and then you’ve got the D I.

00:00:53.067 –> 00:00:59.267
Y. People, these are folks that read something online or took a course and think they can do it themselves.

00:00:59.277 –> 00:01:06.067
Then you’ve got the mass market sales folks that are trying to sell everybody all your problems fixed with debt settlement.

00:01:06.077 –> 00:01:09.657
And then finally we have the customized coaching.

00:01:09.927 –> 00:01:23.937
Solution where everybody gets treated individually and you know what, I think there’s one more, call it the creditor mailer settlement where you don’t do anything but default and then sooner or later you get a mailer did I leave anything out?

00:01:23.947 –> 00:01:33.707
No, I mean I think you pretty much covered it, Give me your impression about people in forms or online that just say, oh you can settle your debt.

00:01:33.707 –> 00:01:42.827
It’s easy, what are they leaving out in that statement For some people, they’re leaving out the for some people.

00:01:44.357 –> 00:01:48.727
It is easy for some people, but it’s not really that easy for most people.

00:01:48.737 –> 00:01:56.117
You know, it’s not like you just pick up the phone and say that the creditor, you know, some secret code 739 that means the best settlement deal.

00:01:56.127 –> 00:02:00.417
It’s easy for somebody like me who’s been dealing with this stuff for 20 years.

00:02:00.427 –> 00:02:11.507
It’s probably easy for someone like you, you know, so here’s the thing that always blows my mind is people say I’m gonna call my creditor and settle my debt.

00:02:11.827 –> 00:02:24.867
How in the world do you know if you’re getting the good deal, the current deal, the best deal, how do you know if this fits in your overall situation just because you think that you can do something doesn’t mean that you can get the best possible result.

00:02:24.877 –> 00:02:28.947
You know, the biggest thing is just there’s my stutter. I just noticed it.

00:02:30.847 –> 00:02:34.117
I never knew I had one until Steve started editing our podcast.

00:02:34.127 –> 00:02:47.847
You know, people get on these forms and start reading and they go, oh yeah, all you do is you just, you know, don’t pay your bills and you just wait and you negotiate it down or hey, you know, I’m sure they just bought it for five cents on the dollar. So offer them 10 cents on the dollar and they’ll gladly take it.

00:02:48.183 –> 00:02:55.023
So much stuff that people think is, you know, it’s all this or it’s all that and every creditor is different.

00:02:55.033 –> 00:03:06.553
Every scenario is different. Every situation is different. So there’s a little bit of truth sprinkled into what you read online, but it’s very, very difficult to just take that advice and then just apply it to your situation.

00:03:06.553 –> 00:03:15.223
And every specific creditor you have because you know, some creditors you have to do the exact opposite approach that you have to take for other creditors.

00:03:15.243 –> 00:03:21.163
And the only way to really understand that is to have experience with those specific creditors and what their protocols are.

00:03:21.233 –> 00:03:31.623
Because that’s really all it is. You know, negotiation with creditors is really just understanding what they’re going to do after you do certain things like not pay a bill.

00:03:31.633 –> 00:03:36.233
What does this specific creditor do if you don’t pay that bill, Are they going to send you to an attorney?

00:03:36.483 –> 00:03:42.053
Are they gonna sue you? Are they gonna jump up and down kicking and screaming and beg you to to pay them?

00:03:42.063 –> 00:03:47.333
You know, every creditor has different protocols that you really need to understand before you just jump off a cliff.

00:03:47.343 –> 00:03:58.463
If you said online only accept a deal where they’re gonna take 30% or less and they have to send you the offer in writing and they have to accept your post dated check or whatever Maybe.

00:03:58.473 –> 00:04:06.923
But you know, some major creditors might only take 60% of the debt, not give you it in writing and require you to fund it first.

00:04:06.933 –> 00:04:11.983
That doesn’t mean it’s wrong. It might be different but you got to know what the creditors are doing.

00:04:11.993 –> 00:04:20.873
Yeah. And their protocol. And the other thing is don’t get self righteous. If you’re trying to negotiate debt with a creditor you owe, Oh, them money usually right.

00:04:20.883 –> 00:04:24.863
And if they’re saying, Hey, fine, we will forgive 40% of it.

00:04:24.873 –> 00:04:35.083
And under these specific terms. And this is the protocol sometimes pitching a fit about that and arguing with them is not the right move they are offering to forgive.

00:04:35.337 –> 00:04:39.597
40% of your debt or whatever it is. So you got to check the self righteousness,

00:04:39.607 –> 00:04:50.697
at the door if you’re trying to negotiate an account and don’t go in with a certain expectation and basically thinking if they don’t do exactly what the guy on the facebook forum said, they’re gonna do that.

00:04:50.697 –> 00:04:58.293
I’m not gonna take that deal. You could easily be snatching defeat from the jaws of victory there next one, which is D. I. Y.

00:04:58.303 –> 00:05:09.343
Debt settlement where you’ve purchased a course or took an online course or something like that, at least that gets you one step closer to the know when to hold em, know when to fold them routine.

00:05:09.353 –> 00:05:19.689
A problem. I have observed Damon is that you could say Citibank does x normally, but in the last four months they’ve change Their approach, they’ve changed their process.

00:05:19.759 –> 00:05:26.279
I’m sure you can think of a creditor that it’s changed over time. Like Chase Chase has changed, it’s always a moving target.

00:05:26.289 –> 00:05:38.079
You know, some creditors, I can look back and say, you know, they’ve had the same policies for a decade where it’s just like clockwork now, those could change at any time. But I can look back and say, well the last 10 years it hasn’t changed.

00:05:38.237 –> 00:05:51.827
And then like you mentioned, Chase Chase for a long time had a certain policy, they weren’t very aggressive and it was just kind of go along to get along and you know, you could get good deals with them and then they made kind of a pretty abrupt left turn a,

00:05:51.837 –> 00:05:58.067
year or two ago and they’re not super, super aggressive, but they’re definitely a lot more aggressive than they used to be.

00:05:58.077 –> 00:06:03.007
So things change. So, you know, if if you’ve got some kind of coaching or some kind of help,

00:06:03.017 –> 00:06:07.667
I also, I always recommend that over just trying to say, hey, I’m gonna just gonna wing it,

00:06:07.677 –> 00:06:19.167
not that you can’t get it done, there’s a lot of pitfalls that as a consumer that’s never done this, you really should be aware of before you jump into the deep end, especially if you’re going to wing it and if you’re going to wing it.

00:06:19.394 –> 00:06:27.154
You can actually save yourself a whole lot of money and just default on your debt and wait for the creditors to actually send you an offer.

00:06:27.164 –> 00:06:34.214
But when you default on the debt, first thing you should do is go listen to our podcast that we did all about debt collection and learn how to best deal with that.

00:06:34.224 –> 00:06:45.914
But the second thing is it can be really emotional stressful and you can make a lot of Mistakes waiting to get to the point where the creditors are sending you that offer because it’s gonna hurt your credit.

00:06:45.914 –> 00:06:49.504
You’re gonna be in collections, you might get sued, you might get threatened.

00:06:49.514 –> 00:06:54.474
But if you just sit tight and wait for the creditors to send you an offer, it does happen.

00:06:54.484 –> 00:07:01.444
Oh absolutely. I mean you could wing it. I mean, how do you think I learned all this stuff 20 years ago I was a brash young college student.

00:07:01.444 –> 00:07:08.324
I thought, hey, you know, I’m real smart and I had about 40 grand in debt and I thought, hey, I’m gonna wing it and I’m not gonna pay it back, I’m gonna see what happens.

00:07:08.324 –> 00:07:12.844
I want to learn this stuff. So you know, and that and that’s what I did and I let all my, my payments go.

00:07:12.844 –> 00:07:24.304
And I had all the books and I was ready and I had, you know, California rules of civil procedure and you know court for dummies and, And all of that stuff and it worked out for me. I ended up getting sued three times.

00:07:24.314 –> 00:07:36.944
I went to court. In fact one of the $20,000 lawsuits, I had to take all the way up to the appellate court before I finally one hours and hours and hours of study, hours and hours and hours in court back and forth motions, things like that.

00:07:36.954 –> 00:07:40.224
And I eventually prevailed. It took me several years.

00:07:40.234 –> 00:07:54.014
Most consumers probably really don’t want to go that route, but I learned a hell of a lot. So if you’re up for it and you’ve got the aptitude for it and you really want to learn it and hey, I wonder what happens if I have to go to court and you know, that’s fine, you can do that.

00:07:54.024 –> 00:08:00.594
But I also learned that there’s better ways rather than just trying to wing it yourself and see how it turns out for you in court.

00:08:00.604 –> 00:08:08.134
So let me give you an example. I had a client many years ago, They had a Son city bank debt. I think it was. They made an offer.

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00:08:08.144 –> 00:08:15.964
They said offer Citibank $30,000 on a $40,000 debt will cash out everything will scrape together the money.

00:08:15.974 –> 00:08:22.834
And Citibank said, hell no, no way. We’re never going to accept that kind of offer. Get lost.

00:08:23.104 –> 00:08:30.324
And the client went home and in his mailbox was an offer from Citibank for the exact same debt for $21,000.

00:08:30.334 –> 00:08:36.444
Oh yeah, absolutely. Because it’s a creditors for the most part operate by a process.

00:08:36.454 –> 00:08:45.244
Right? And when you call in, you’re just talking to a representative that may or may not have access to your specific files or what’s going on.

00:08:45.254 –> 00:08:52.474
And you could absolutely get an offer in the mail and that offer in the mail might be the best offer you’re gonna get from that bank.

00:08:52.748 –> 00:09:06.558
Or it might be the first volley. It might be a hey, this is a good offer. But if I push a little bit more or I call the specific phone number that’s on the offer which will probably be a different department than the main number that you called.

00:09:06.568 –> 00:09:18.678
Who the rep said we have no idea what you’re talking about. We’re not gonna settle. No way. Because that representative in that department wasn’t even authorized to do a settlement. So they’re speaking, what do the kids say these days? Their truth.

00:09:18.688 –> 00:09:30.608
That’s their truth. Right? Well that’s not your truth. Your truth is in the mailbox right there saying they will do a settlement and not only will they do a settlement but they’ll do one for cheaper than what they just told you hell no to the day before.

00:09:30.608 –> 00:09:39.938
So it all, it just comes down to again, understanding those specific creditors processes and what they will do and what they won’t do.

00:09:39.938 –> 00:09:47.563
And that’s where getting some kind of help comes into play. Whether that’s just some coaching help or that’s some somebody doing it for you or whatever it is.

00:09:47.573 –> 00:09:50.593
You know, you can wing it. You can do it yourself without any help.

00:09:50.603 –> 00:09:57.453
But you could be leaving a lot of money on the table and you could find yourself in some courtrooms that you prefer not to get into if you don’t know what you’re doing.

00:09:57.463 –> 00:10:00.743
Well. Speaking of getting some help, the next thing is.

00:10:01.003 –> 00:10:08.283
That kind of mass market debt settlement sales solution where some commissioned salesperson sold you.

00:10:08.533 –> 00:10:19.558
Debt settlement is gonna cure all your problems and it’s going to take care of everything and you’re gonna sign up with us and your account will get dumped on a team and everything will be taken care of.

00:10:20.538 –> 00:10:29.248
That doesn’t quite work out all the time either does it? No, I really hate that because it’s such a one size fits none is what I call it.

00:10:29.258 –> 00:10:42.478
Every single person that calls in for help is gonna get the same pitch and there’s absolutely no way every single person needs the same solution. But that’s the only solution they sell. So that’s what they pitch you and it’s not customized at all.

00:10:42.488 –> 00:10:51.558
They want to throw everything against the wall, stop paying all your debts. Just start sending us the money and then you’re just crossing your fingers that it’s all gonna work out over the next couple of years.

00:10:51.568 –> 00:10:55.998
They’re very light on details with exactly what they’re gonna be doing, what they’re not going to be doing.

00:10:56.168 –> 00:11:08.628
The sales guy or gal usually just gives a very rosy version of the process. But in my experience, most consumers don’t fully understand what they just signed up for when they get into a program like that.

00:11:08.638 –> 00:11:15.098
And the reason they don’t fully understand it is because they have slick sales presentations and their focus is on making the sale.

00:11:15.098 –> 00:11:24.988
So they really try to avoid any of the potential negatives and really hype up all the potential advantages because they’re afraid that if you knew exactly how it worked,

00:11:25.148 –> 00:11:37.658
you may choose to not like that approach because it is your money, it’s your credit, it’s your life, It should be your decision and you can’t really make an educated decision unless you fully understand what you’re about to get into.

00:11:37.828 –> 00:11:40.028
And they understand that they want to maximize their sales.

00:11:40.028 –> 00:11:45.088
So they want to dumb it down to just say, hey, look, you owe all this debt, you’re paying $1000 a month.

00:11:45.098 –> 00:11:54.188
If you hire us, it’ll be great. We’ll knock your payment down to 7 50 a month. You’re gonna save 2 50 a month right away. So just stop paying your creditors and send us the money and we’ll handle it.

00:11:54.198 –> 00:12:02.908
And they have all this, you know, magic words and nice phrases and we’re gonna have, attorneys are gonna take care of this and they make it seem like you’re enrolling into some program.

00:12:03.308 –> 00:12:15.208
And I use air quotes, there is no damn program. You know that money is not going to your creditors. Even though a lot of these sales people give you the impression that your your monthly payment is going to go down.

00:12:15.218 –> 00:12:22.258
There is no damn monthly payment in a mass market debt settlement program. They’re just sitting on your money that you’re giving them.

00:12:22.268 –> 00:12:26.588
You can sit on your own damn money. You don’t have to give it to somebody else to sit on for you.

00:12:26.888 –> 00:12:37.808
There’s the mass market solution where we have attorneys that will help you really. That’s just a legal loophole so that they can take fees in advance before providing the services.

00:12:37.818 –> 00:12:45.338
And then variation two is the one where you’re not going to have to pay anything until they actually reach a deal.

00:12:45.348 –> 00:12:52.388
The key though is is the deal really any good or was it the first deal they could take so they could take your fees.

00:12:52.398 –> 00:13:02.388
Yeah. And the other thing is remember when you hire a program like this, they’re only focuses on one thing and life has many different focuses right things come up in life that you don’t expect.

00:13:02.388 –> 00:13:08.178
So you get on some program that is a four year program or whatever it is. Even under the best case scenario.

00:13:08.188 –> 00:13:12.608
Well what happens if 68 10 months in you lose your job, you’re unemployed for a couple of months.

00:13:12.618 –> 00:13:19.498
You get you know, all this extra money you’re going sending to this debt settlement company to sit on for you again? They’re only focused on settling your debt.

00:13:19.508 –> 00:13:25.618
Well if you’re out of work for several months, do you get the ship about settling your debt at that moment?

00:13:25.628 –> 00:13:32.378
You know, you probably care more about paying your mortgage, feeding your kids, keeping your car payment current or you know, whatever your priorities are.

00:13:32.378 –> 00:13:40.708
My guess is settling your debt dramatically dropped on your list of things you give a shit about if you’re unemployed for a couple of months all of a sudden.

00:13:40.718 –> 00:13:51.008
So what are you gonna do? You gonna call up that company and say, hey, please give me some of my money back because they’re going to try to talk you into keeping you in the program so they can keep making their money.

00:13:51.425 –> 00:13:54.625
Absolutely. They don’t want to give the money back and then lose the commission.

00:13:54.635 –> 00:14:02.145
Oh, you know, you gotta, they turn into the facebook warriors right? You gotta stay the course, You gotta keep it going. What are you gonna, you know, it’s like quitting the gym.

00:14:02.155 –> 00:14:09.145
They wanna give you all the reasons why you’re a loser if you cancel out of the program because they want to hold on to that commission.

00:14:09.155 –> 00:14:22.612
But it’s your money shouldn’t you have control over that decision. If you decide that, hey, this month paying my mortgage is more important to me than maybe settling a bank of America card six months from now. Shouldn’t that be your decision?

00:14:22.822 –> 00:14:28.002
Well, it’s not your decision. If they have all of your money, it is your decision. If you have all of your money.

00:14:28.032 –> 00:14:36.052
So if they’re not gonna pay a creditor for six months anyway, why the hell can’t you hold your own money for six months and then release the money when the deal’s done.

00:14:36.102 –> 00:14:41.992
Nobody ever asked these companies and why don’t they want that? Because they want to be able to control the process.

00:14:42.152 –> 00:14:52.049
They don’t want you involved in your life and your decisions. They were, I want to do what’s best for them and do deals when it’s best for them to collect their fees, not what’s best for you.

00:14:52.099 –> 00:15:05.409
They don’t want to say, hey, you know what? That really sucks that you lost your job, Let’s take a step back. Let’s not worry about settling the debt right now. Let’s pay the bills that you really need to get paid and let’s focus on moving forward. Let’s see if you can get a job, you know, let’s, let’s pump the brakes here.

00:15:05.419 –> 00:15:15.946
Well, if you get a job next week, you start making more money. Maybe we can continue the process. Maybe it still makes sense if you’re out of a job for another two months, three months, four months.

00:15:15.956 –> 00:15:21.696
Hey, guess what? Maybe a Chapter seven bankruptcy, that maybe didn’t make sense six months ago when you signed up,

00:15:21.706 –> 00:15:31.216
might make a hell of a lot of sense now because now you can qualify for a Chapter Seven, maybe we forget about the debt settlement, we take a right turn into bankruptcy.

00:15:31.226 –> 00:15:40.575
It sucks that you lost your job. But I guess the silver lining of that is we can at least wipe out this 50 grand in debt while you’re going through all this stuff anyway. We didn’t want it to happen, but it happened.

00:15:40.793 –> 00:15:50.733
So might as well make the best of that bad situation, get this debt wiped out. Now you get a new job and now you don’t have to set money aside for debt settlement anymore you got it wiped out in the bankruptcy.

00:15:50.743 –> 00:16:04.133
And now when you’re starting to make money you can catch up on the things that are more important that you probably fell behind on a little bit during that period of unemployment. Like maybe your car payment got a couple of months behind on your mortgage or something like that and now you don’t have to worry about that steve.

00:16:04.143 –> 00:16:18.893
What are the chances? A mass market debt settlement company is going to have a consultation with a current client about a scenario like that and recommend hey you should stop sending us money and maybe you should go meet with the bankruptcy attorney and see if that might be a better option.

00:16:18.903 –> 00:16:23.013
The percentage would be as close to zero as mathematically possible.

00:16:23.053 –> 00:16:29.183
Exactly. So how, how is hiring them helping you at all? They’re not there to help you solve your problem.

00:16:29.373 –> 00:16:34.143
They’re there to sign you up into their solution. Whether it fixes your problem or not, that’s right.

00:16:34.143 –> 00:16:44.603
It’s like my example of you go in an emergency room and you cut your foot but you went to the emergency room where everybody gets a cast, you get a cast, you get a cast.

00:16:44.613 –> 00:16:48.353
It’s not about what you need, it’s about what they’re selling.

00:16:48.533 –> 00:16:52.733
So now we get into what I like to call the metal level, right?

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00:16:52.733 –> 00:17:00.433
So this is the gold platinum titanium, whatever level of debt settlement, the concierge V.

00:17:00.433 –> 00:17:07.983
I. P. Level where instead of being a one size fits none or I don’t know what I’m doing by myself approach.

00:17:07.993 –> 00:17:15.163
This is you’re working with a professional that treats every debt individually. They don’t all need to be settled.

00:17:15.173 –> 00:17:18.203
You might need to settle, one, might need to settle none.

00:17:18.353 –> 00:17:21.643
But you’re getting a customized solution. Let’s talk about that.

00:17:21.653 –> 00:17:28.453
Well, and I always preface this with everything I’m about to say is completely 100% bias because it’s what I do.

00:17:28.463 –> 00:17:36.973
Now, am I saying it? Because it’s just what I do or do I give this advice? Because it’s the right damn advice. You know, that’s a.

00:17:37.373 –> 00:17:43.963
For you to decide. But this is what I do. A custom solution for every client.

00:17:43.973 –> 00:17:54.173
And it’s the thing that I always toot my own horn about because it’s not freaking offered out there. These companies don’t do that. They’re not interested in what’s right for you.

00:17:54.183 –> 00:18:05.043
They’re interested in what’s right for them. And if you don’t believe me call a whole bunch of them, if you go to a mass market solution, they’re not gonna say, oh you got six debts, okay. We need to prioritize this one, put a hold on that one.

00:18:05.053 –> 00:18:09.023
We need to think about this creditors doing really great settlements right now.

00:18:09.033 –> 00:18:11.293
So let’s move that to the head of the line.

00:18:11.323 –> 00:18:16.493
Let’s put this one at the back and instead they try to wedge everybody into one solution.

00:18:16.503 –> 00:18:22.833
Yeah. And that’s it. And then you know, they try to dumb it down for the consumer. So the consumer thinks it’s great, right?

00:18:22.843 –> 00:18:30.353
They don’t give you exactly what is going on because they’re afraid you might decide. I don’t really like that. I’m not comfortable with that approach.

00:18:30.363 –> 00:18:33.363
I don’t like the idea of this or I don’t like the idea of that.

00:18:33.373 –> 00:18:43.303
Well that gives you an opportunity to say no to their service. So they’re not going to present you with anything that can be construed by some people as non optimal if you will, right?

00:18:43.313 –> 00:18:51.283
But if you’re a consumer and this you’ve got this debt and it’s affecting your life, it’s affecting your family and you’re trying to figure out the best way out of it.

00:18:51.723 –> 00:18:55.823
Don’t you want all the information so you can make the right decision.

00:18:55.833 –> 00:19:06.963
It’s like why would you go to a car dealership and when the sales people trip over themselves to be the first one out the door to get out to the parking lot and you say, hey, do you think it’s a good time to buy a car right now?

00:19:06.963 –> 00:19:13.873
Or should I wait? I heard there’s a recession coming, but I don’t know. I I, but I, I kind of need a car. Do you think it’s a good time to buy one?

00:19:13.883 –> 00:19:25.343
Many sales people are gonna say, hell no, you should wait. I think you know, absolutely you gotta buy. And then you say, well, okay, well there’s a lot of car dealerships in town. Where should I buy a car?

00:19:25.353 –> 00:19:29.613
Where’s the best place for me to buy a car f in here? That’s the best place to buy a car.

00:19:29.623 –> 00:19:34.163
I always joke. You pull up to the ford dealer and you say, should I buy a Toyota Absolutely.

00:19:34.173 –> 00:19:39.823
Toyotas are better than ford. They have better deals, better offers. I’ll drive you there myself.

00:19:40.073 –> 00:19:45.233
Yeah, because I’m not gonna be able to come back here. Once I give you this advice, I’m gonna have to get a job at the Toyota dealer.

00:19:45.243 –> 00:19:53.573
So when you call some company, some legal group that pretends to be attorneys or a debt validation company or mass market debt settlement company.

00:19:53.583 –> 00:20:00.023
And you say, is this the best solution for me. Don’t be surprised when they go, oh yeah, of course it is.

00:20:00.033 –> 00:20:06.373
It’s just a salesperson talking to you, You’re not getting financial advice and you know, most people because I don’t, I don’t advertise.

00:20:06.383 –> 00:20:13.933
So most people if they find it’s, you know, maybe they heard our podcast or they stumbled across somebody online recommended me or or something like that.

00:20:13.933 –> 00:20:25.623
And they got lucky in a google search and I say lucky because I think the last blog post I wrote on my website was, I don’t know, 10 years ago, I just don’t have time to my website looks like it’s, you know, like made when craigslist came out.

00:20:25.633 –> 00:20:36.533
It’s not beautiful. But hey, it gets the point across. Most people find me after, they’ve talked to several sales people. I don’t care if it’s credit counseling and debt settlement, that validation, whatever it is.

00:20:36.723 –> 00:20:43.383
And then they have a conversation with me. And the biggest comment I always get is you’re like the first person I talked to that made any sense.

00:20:43.563 –> 00:20:48.763
Like I understand what you’re saying and when I ask you questions, you explain it in a way that can make sense.

00:20:48.763 –> 00:20:59.833
And I’m I’m not more confused leaving the call than I was when I made the call and that’s why I love when people find me after they’ve talked to these companies because it just makes me look so good.

00:20:59.843 –> 00:21:08.153
Like wow, somebody that knows what they’re talking about and actually make sense because again, my focus and what the service that I provide is helping you figure out.

00:21:08.431 –> 00:21:14.131
The right strategy based on your specific situation, that’s why what I say makes so much sense.

00:21:14.131 –> 00:21:17.521
And what these sales guys say always leaves something to be desired.

00:21:17.521 –> 00:21:24.131
It’s a little bit confusing because they’re trying to take your problem and wedge their solution around it, right?

00:21:24.131 –> 00:21:29.696
And that’s why it seems a little weird, but when you don’t have that requirement, like if I’m not a sales guy,

00:21:29.716 –> 00:21:39.506
knowing I have to try to pitch you on this specific program or solution, I’m free to explain things how they are and that just tends to make sense.

00:21:39.516 –> 00:21:49.551
And that’s why anybody should go to Damon day dot com and ask a question, Talk to Damon or visit my site, Get out of debt dot org, submit a question online.

00:21:49.751 –> 00:21:59.751
Both of us will be very happy to answer it. When people come in Damon and they say x company said debt settlement is the best approach and I want to know right now. Do you agree?

00:21:59.761 –> 00:22:10.411
And the only answer I can ever offer is maybe Because because it really depends on each person’s individual situation.

00:22:10.421 –> 00:22:13.891
Here’s an example last week,

00:22:13.901 –> 00:22:27.341
a woman who was 45 years old was thinking of getting involved in a program that was going to take her five years and cost her $899 a month if she took a different approach and she was eligible for bankruptcy.

00:22:27.541 –> 00:22:39.231
And she filed bankruptcy and discharged all of her debt in 90 days and instead put that 899 a month in an investment for retirement for the next the same period of time.

00:22:39.451 –> 00:22:44.411
She’d end up having about $650,000 in retirement.

00:22:44.421 –> 00:22:51.211
That’s the fact that people should know before they just decide on what some slick selling salesperson was telling them.

00:22:51.221 –> 00:23:03.651
Yeah. And you know, we talk about bankruptcy a lot and I always like to remind people that, hey look, we’re not advocates for bankruptcy bankruptcy bankruptcy. That that would just be as bad as a debt settlement company. Being an advocate for settlement settlement settlement.

00:23:03.661 –> 00:23:11.491
You know, our focus is, it doesn’t hurt to look at the numbers and get all the information and then you decide what is best for you.

00:23:11.491 –> 00:23:23.451
So just, you know, some people just get upset about talking about bankruptcy and it’s like talking about it, it’s fine if we talk about it and you don’t like something about it and you want to do a different strategy, that’s great.

00:23:23.461 –> 00:23:29.151
At least now, you know, for sure why you want to maybe avoid bankruptcy or not avoid it.

00:23:29.161 –> 00:23:33.331
You know, sometimes you might look at it and go over the numbers and you go, huh?

00:23:33.647 –> 00:23:43.227
That’s not nearly as bad as I thought it was gonna be. I never really had an in depth conversation about it and I didn’t really understand it now that it’s been presented this way.

00:23:43.237 –> 00:23:49.587
Maybe it’s something that’s worth taking a look at before I jump off a cliff over here on this other program.

00:23:49.597 –> 00:23:52.567
You know, again, it’s your money, it’s your life, it’s your credit.

00:23:52.577 –> 00:23:58.447
It needs to be your decision. Well, an educated consumer is always the best person to work with.

00:23:58.457 –> 00:24:06.193
And that’s the whole focus of this podcast, Damon is anything else. Before we wrap this up that we should let people know about debt settlement.

00:24:06.203 –> 00:24:13.173
It’s never as simple as it’s presented to you. There’s always nuances in there and Gotchas and I don’t think we really covered it that much.

00:24:13.173 –> 00:24:25.119
We mentioned it a little bit, but when you just say debt settlement, you know, most of these companies, they just want you to stop paying everything and jump into their program. But there’s many, many different ways, even if a debt settlement strategy makes sense.

00:24:25.129 –> 00:24:34.979
There’s a million different ways to implement it, where you can really customize the strategy where it’s like, well maybe I’ll settle these two or three debts that are the largest ones or whatever it is.

00:24:34.979 –> 00:24:48.137
But these other small ones, um you know, I’ll keep open, I’ve got a 10 year positive history on the trade line and I’m not really gonna save that much on trying to settle a $1500 debt. So I’m just gonna keep that one current, There’s just a million different ways to look at it.

00:24:48.147 –> 00:24:55.667
And a debt settlement company is not going to sit down with you and strategize that. They’re just gonna say whatever their threshold is, let’s say it’s 500 bucks.

00:24:55.677 –> 00:25:01.217
Any account you have, that’s more than 500 bucks. They’re gonna recommend you put it in their program, right? No matter what exactly.

00:25:01.227 –> 00:25:04.327
Alright, Damon. Thank you so much for joining us again this week.

00:25:04.337 –> 00:25:08.297
Damon@DamonDay.com is the email address.

00:25:08.307 –> 00:25:15.557
If you have a question, come visit me Steve Rhode. Get out of debt guy at get out of debt dot org. Bye bye. See you.

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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2 thoughts on “Debt Settlement is Like an Onion. What You Need to Know About the Five Types of Debt Settlement.”

  1. Good analogy- like an onion with layers. However, when it comes to the advice lower-income seniors normally get from debt settlement and management companies, it’s not the onion layers; it’s the advice- it stinks. They are rarely told, “by the way your Social Security and other retirement income is protected by law it doesn’t need to be used to pay debt you can’t afford to pay.” Including how unwanted collector contact can be stopped.

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