Charlotte, NC Bankruptcy Lawyer and Debt Settlement Legal Services

Posts Tagged ‘Debt’

WARNING: The Latest Internet Scam is Credit Card Debt Termination.

Too good to be true because it is 100% False.
Consumers be warned- “credit card debt termination” scams are spreading like wildfire right now on the Internet. It usually goes by the name “Credit Card Termination or some variation on that name, and victims are paying thousands of dollars for this bogus service with the false belief that their debt will dissipate and their credit scored will not be damaged. By presenting a phony interpretation of banking and accounting laws, these con artists claim that they can legally terminate all of your credit card debt. They will go as far as hosting phony arbitrations and presenting victims with fake court documents.

This scheme has its roots in the income tax protest movement of the 1970s, where people were claiming that paying taxes was unconstitutional. Among professionals in the collection industry, the “Credit Card Termination” scam is called the “monetary protest movement.” The common theme with these programs is that our banking system prohibits banks from lending out their own money. So how does a credit card bank extend credit then? The protesters claim that the credit card agreement itself becomes a form of money the moment you sign it. Their premise is that the bank “deposits” your agreement as an asset on their books, and then any credit you use is offset as a liability against that asset. The scam promoters claim that all you need to do to wipe out your debt is demand your original “deposit” back from the bank, which will be offset against what you borrowed. THIS IS NOT TRUE or LEGITIMATE!! Just as the IRS shut down the tax protesters, the Attorney General’s Offices are actively prosecuting businesses and individuals for their participation in these fraudulent “debt termination” services.

Individuals in financial crisis may be tempted and lured in by the false promises and bogus testimonials advertised on the web pages of these, only to find themselves in worse trouble and greater debt. As I have advocated in other articles, investigate the credibility of any debt service providers you are considering. Are they licensed attorneys? Do they belong to the Better Business Bureau? Is there a physical office and address you can verify? Though you may feel stressed out, hopeless and think that things could not get any worse- trust me, get involved with one of these bogus “debt termination” scams and things will get a lot worse as your creditors, assuming that you have blithely ignored them, come after you.

As the Baby Boomer workforce faces retirement, personal debt will be a problem for many. Baby Boomers have earned the moniker “Sandwich Generation” as they are the first generation to face significant financial obligations for the previous generation as well as the future generation. Medical bills and assisted care for aging parents and skyrocketing education expenses are just a few examples of costs that will force a growing number of Baby Boomers to carry more debt into retirement. This debt will drain further an already underfunded retirement savings and force many Boomers to work longer or accept a lower standard of living.

The recession and weak economy have further hindered Baby Boomers in their quest to retire and enjoy the fruits of their lifetime of labor. 401K account balances have dwindled and have mockingly referred to as “201K’s”. On top of this, Social Security and Medicare will be going through many changes, which may further complicate future plans for Baby Boomers.

While most financial guides advocate the best way to prepare for retirement is to “save more money”, this advice is not particularly helpful or feasible for many Baby Boomers, given the financial realities they face. Neither are the traditional principles of curtailing spending or increasing earnings. 

* Save More – If they could, they would. Baby Boomers are the most driven and successful generation in terms of goal attainment and focus; patronizing, irrelevant advice such as this is both unhelpful as well as irritating.

* Spend Less – This works only on discretionary spending and is not particularly applicable to health insurance, medicine and medical care spending which is significant and ongoing for Baby Boomers caring for aging parents.
* Earn More – With soaring unemployment, organizational downsizing and cost cutting, it is more and more difficult for Baby Boomers to find paycheck which will cover their expenses and financial obligations AND fund retirement.

Most Baby Boomers ascribe to traditional values of honoring financial obligations and payments to their creditors, resulting in a highly stressful juggling act. Adding to the stress of the situation is the self imposed isolation; most Baby Boomers are ashamed to acknowledge, discuss or seek help with their debt.

If you are a Baby Boomer and have nodded in agreement while reading this article, let me ask for a few more moments of your time. There is nothing dishonorable about obtaining advice and assistance to manage financial hardship. If you are the sole supporter of your family, seeking help is the smart and responsible decision rather than suffering alone, letting the stress of the situation wear you down both physically and mentally. Recall airline safety demonstrations- place your own emergency oxygen mask on first before assisting your dependents.

“I feel like I can breathe again”, many of my clients say after learning about the debt relief options available to them. Legitimate debt relief providers, such as licensed attorneys and non-profit organizations, can give the information, guidance and planning individuals in financial crisis need to end the spiral of mounting debt and move towards financial wellness. Baby Boomers, make happiness the main ingredient in the generational “sandwich” of your lives.

In the current economic environment, many people have fallen into debt. As the debts continue to multiply, the ability to pay them becomes virtually impossible. As the reasons and causes of the debt vary from each individual, so do the solutions. It is important to understand that Bankruptcy is NOT a one size fits all solution.

Contrary to popular belief, not everyone is eligible to declare bankruptcy. In October of 2008, the means test established by the 2005 Federal Bankruptcy Reform act was adjusted. This means test compares your income with the median average monthly income in your state to determine whether you are eligible to have your debts discharged in bankruptcy or whether you must participate in a repayment plan and/or file Chapter 13 bankruptcy instead of Chapter 7 bankruptcy. Median income figures were adjusted by the Department of Justice on October 1, 2008, altering the numbers at which you would be considered eligible for discharge of debt. If you have questions about these laws or the impact on your case, consult with an experienced bankruptcy attorney in your state who can provide you with relevant local information and rules.

While bankruptcy should be considered as an option, it should not be recommended immediately as the ONLY option. Without a detailed, personal financial analysis and application of the Federal Bankruptcy Means Test, it is impossible to truly know if the individual even qualifies to file bankruptcy. If a service provider instantly pushes for bankruptcy as the only solution- this should be a red flag to individuals that they may need to get a second opinion.

About the Author: Joseph M. Bochicchio, PLLC. is a licensed Charlotte, NC Bankruptcy Lawyer with nearly 2 decades of experience in finance and law. His Charlotte Debt Settlement Law Firm is committed to providing legal and ethical guidance for North Carolinians facing financial hardship.

Many people find themselves buried in debt; mortgages, credit cards and medical bills that appear to be endless. There are debt solutions to stop the landslide. Common reasons for spiraling debt include job loss, unforeseen emergencies, divorce and overspending. There are three primary options for an individual facing financial hardship and bad debt: debt management, debt settlement and bankruptcy.

Getting back on the right track can appear to be almost impossible, and individuals need to be aware that there are many scams and unethical advertisements for services that actually worsen their situation. To solve your debt problems, you need to understand your options and then seek out legitimate providers of debt settlement or bankruptcy services. In North Carolina, it is illegal for anyone other than a North Carolina licensed attorney or a non-profit organization to offer debt settlement services.

Harassing collection calls and billing notices can create high levels of fear and anxiety, and individuals will impulsively sign on with a pseudo-debt service without any research. High fees and fine print, which states that the fees must be accumulated first before paying $1.00 towards your debt, can make a bad financial situation even worse. Be wary of these illegal service providers- do your homework, ask for references, check that they are licensed to practice law in the State of North Carolina.

Currently, the North Carolina Attorney General is actively prosecuting fraudulent debt service providers and individuals illegally engaged in debt settlement practice.

About the Author: Joseph M. Bochicchio, PLLC. is a licensed Charlotte, NC Bankruptcy Lawyer with nearly 2 decades of experience in finance and law. His Charlotte Debt Settlement Law Firm is committed to providing legal and ethical guidance for North Carolinians facing financial hardship.