I Was Just About to Sign a Debt Settlement Contract With Lloyd Ward & Associates. – Paula

“Dear Steve,

Just found your site in the nick of time as I was about to sign a debt settlement contract with Lloyd Ward and Associates.

My husband and I are self employed and our businesses had a hard time since 2005, but then bit the dust in 2009. We went from staying current with everything, including large credit card balances to falling behind on everything.

We just managed to negotiate two home loan modifications, for our two mortgages, in the last month. Meanwhile, the credit card balances with interest and penalties hit the roof.

Now we face our huge credit card debt, close to $100,000. Unbelievable I know. One account, Citibank, just served me a summons.

I had really hoped to be able to do a debt settlement and also have contacted Damon Day for a personal consultation.

Can you give me any information on declaring bankruptcy? I would hope that we could manage a chapter 13 so that we could at least keep our home. Our first mortgage which we took out in 2001 is for $220,000.

Our businesses are starting to bring in more income but we cannot afford $1,000 to $2,000 a month for settlement. Do creditors ever take smaller amounts monthly rather than going to court?

We have four daughters and wanted to show them a good example of paying our debts, but this may not be possible.

Thank you,

Paula ”

Dear Paula,

Thank you for contacting me. I hope I can get you going in the right direction and alleviate your fears.

I’m glad you contacted Damon Day for an independent review of debt settlement. He’s a good guy and I’m impressed with his honest advice and from the heart direction he gives people.

Your comment, “We have four daughters and wanted to show them a good example of paying our debts, but this may not be possible”, caught my attention.

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May I humbly suggest that the most beneficial lesson you can teach your daughters is that of accepting responsibility to address a situation and putting a realistic plan in place to deal with it. You certainly don’t want to get in the situation where you might, for example, blame farmers in the Dust Bowl in the 1930s for being failures and losers because they walked away from their farms sought another solution other than farming. What I’m probably trying unsuccessfully to say is that it is possible to do the right thing in many different ways.

I would argue that if you put yourself in a situation where you are unable to save money, don’t have an emergency fund, and cough up every spare dollar in an attempt to meet your creditor demands, it is not a responsible thing to do. I would also say that if the example is the mission here that an example of paying back a portion with debt settlement is half an example.

Consider this, it is still possible to repay your debts after bankruptcy if you want to prove a point. But bankruptcy would give you significant protections, avoid and stop lawsuits, and stop collection activity. A Chapter 13 bankruptcy that would let you keep your house and would give you a monthly payment plan based on what you can afford, rather than what the debt settlement or credit card company wants.

The only way to force a creditor to accept a smaller amount if they don’t want to is through bankruptcy. I would suggest that you click here to find a local bankruptcy attorney. Make sure you like your bankruptcy attorney. If you don’t, get a second or third opinion.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

Do you have a question you'd like to ask me for free? Go ahead and click here.
Damon Day - Pro Debt Coach

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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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