Ask The Get Out of Debt Experts Debt Settlement Unemployed

I Got Cancer and My Credit Went South So I Went With First Choice Debt Resolution. – S

“Dear Steve,

I had pristine credit for 10 years and then got cancer in 2008 and also lost my job that same year so at that point I was unable to keep up with my credit cards. I had unfortunately been in a really bad relationship for 5 years and I allowed that person to run up credit card balances. I kept up with all of this for many years and in 2008 when I went through the cancer/job loss I knew I’d not be able to keep up much longer. I went through all of my savings to keep up and thankfully was able to get a job in Jan 2009. At that point, I decided that I was in over my head and wanted to do the debt settlement route. I just couldn’t keep up anymore.

So I UNFORTUNATELY chose First Choice Debt Resolution. UNFORTUNATELY doesn’t fully cover my dislike. At first they were very attentive and involved. They even settled 2 of my smaller accounts within 6 months. As time went on, they got less and less attentive. DUH, they already had my $3000 in fees. At that moment I wasn’t really worried about it because I didn’t have extra money to use in a lump sum, so I kind of had to just keep waiting until the Global Services account filled up.

Earlier this year, I was served a lawsuit by AMEX. I wanted to get that all settled up before the court date because I really didn’t want to go through all of that. First Choice “negotiated” for me and got an okay settlement for the balance- at 40%. As time went on, they basically stopped helping me completely. I emailed 3 of the people I had been working with- they had all been fired. WTF?! The new people claimed they would be helping me….which they mildly did for about 2 days and then again- no responses to emails whatsoever.

At this point I have about $2800 solid that I have saved and would rather NOT have to do lump sums right now, but I also got served by Citibank and have a case in January, so I’d also like to finish this off as well.

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I decided I’m going to have to do this all by myself now. I believe that I could get a settlement of 25% or less of the balance on BOTH my Citibank and the Bank of America- who hasn’t sued me (yet??). I am unemployed; I have zero assets; and do not have the money I have completely in my savings.

I figure they can take what I am offering- or NOTHING! They can’t garnish wages I don’t have, they can’t put liens on houses and cars and accounts I don’t have either- right?

I have read your article about getting refunds from these useless Debt Settlement companies. I’m feeling overwhelmed, but I REALLY need that money back a.s.a.p! My question that wasn’t fully answered in that article was: If they did help me with about 1 yrs worth of “help”, am I able to still request a full refund, or what should I do in that case? Does all of this really happen pretty quickly (the getting refund part?). I can’t find tons of info on First Choice Debt Resolution…..

I’m also kind of nervous on how to approach the negotiating process with the 3 accounts that I still have. The one that I know is with a law firm for sure, am I supposed to directly contact them? I have no idea what is going on with the other accounts. I haven’t gotten served by anyone else, but I’d rather finish all of this off before I am!




Dear S,

You’ve already taken a credit hit with the debt settlement approach so why not just use the protections that the law offers you to stop all creditor suits, prevent creditor calls and eliminate your debt in months? That process is called bankruptcy. For about $1,500, or less if you qualify for pro bono help you could eliminate all of your debt in about three months.

Considering your health situation it seems the benefit of bankruptcy would be significantly positive. Bankruptcy would immediately eliminate the collection stress and stress of the debts. There are trainloads of data that show the correlation between stress, illness and recovery. And those studies show that your health and recovery are negatively impacted with increased stress.

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My vote would be that you should proceed with your refund request and at the same time you should meet with a bankruptcy attorney.

Bankruptcy is also the logical and prudent path, not only because of your health, but also because you have no expectation of returning to the same level of employment. Entering into payment arrangements with your creditors with uncertain income would be unwise. Besides, we need to eliminate this debt and give you the best chance to be able to feed and shelter yourself.

You can click here to find a local bankruptcy attorney and if you’d like a second opinion about your situation or a personal consultation by another debt coach, please feel free to contact Damon Day.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.


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.

About the author

Steve Rhode

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.


  • Also, I don’t know if I did add this before- but I am a current student, and am worried that if I file bk, I will no longer be eligible to receive any Pell money or Federal loans. Does anybody know anything about this?

  • Good news is that bankruptcy does not disqualify you for private student loans and the government has a great site that will show you what insurers are available for you when you are ready for health insurance. Because of health care reform you will no longer be excluded for your pre-existing condition. The site is

    I just saw you are in California. Here is the link for the pre-existing insurance plan in California.

  • Also, I don’t know if I did add this before- but I am a current student, and am worried that if I file bk, I will no longer be eligible to receive any Pell money or Federal loans. Does anybody know anything about this?

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