I’m a Realtor and Drowning in Debt. – Sharon

“Dear Steve,

Due to downturn in housing market, my job as a Realtor was almost eliminated. My $160,000 annual commissions went down to less than $20,000 gross. All the costs associated with being a Realtor still applied. I used all my savings, retirement, insurance cash value, to survive. When that was gone, I used the extensive lines of credit that were available ($80,000). About this time last year, all was exhausted and the market was still in shambles.

I quit paying my unsecured debt about one year ago. Now, the real estate market in my world is returning. After having no closings for nearly a year, I have had one a month since April. And, it is getting better. Now that I have some income again, I am trying to place my debts with a debt settlement company. I bellieve that now I can actually make monthly payments toward the debt.

I have one creditor, Chase, that has scheduled a court date. Most all other accounts have been charged off and some are with collection companies that have offered to settle, but I have not had the money. I have two of those debt collection companies threatening me with legal action now, but no summons as of yet.

One debt settlement company told me that my attorney could take a letter from them to the court on the date Chase has set. She said the letter would satisfy the judge and he would feel the matter was resolved. So my question is #1) Is that statement true and 2) am I in too deep for debt settlement to help me now? I really do not want to file bankruptcy. I believe that with a little more time and a steady recovering housing market, I can resolve these issues. Thanks for your assistance.


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Dear Sharon,

Well the good news is that things are looking up and that’s always the hallmark of a good day.

The “take this letter to court” statement is pretty near BS for me. The judge will need to look at your situation as a matter of law. And if you were in a debt settlement program what would the argument be? “You honor, please forgive Sharon for paying us instead of her creditor.”

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If you want to settle your debts for less than you owe, be legally protected and make payments over time, go talk to a local bankruptcy attorney about a Chapter 13 bankruptcy. You’ll be able to keep your home.

Bankruptcy will be exceedingly cheaper for you than debt settlement. And before you start stressing what bankruptcy will mean for you, go and talk to the bankruptcy attorney for free. Most offer a free bankruptcy consultation to answer your questions. If bankruptcy is a good solution for developers, why isn’t a good solution for realtors? It is.

If you want to stay in your profession, consider bankruptcy, make a ton of money moving forward and save a lot of it to tide you through any future economic downturn. No sense wasting a perfectly good mistake. Learn from it.

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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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