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Dear Readers,

As you may know, Debt Management Guys offers both debt management credit counseling services as well as debt settlement to help people get out of debt and back into financial independence.

However, there is now pending legislation whose sole purpose is to eliminate the debt settlement industry. This will force debt settlement companies to have zero incentive to help people settle their debts and force more people into bankruptcy which ruins your credit score far worse than credit counseling or debt settlement.

A few days ago? Senator Schumer (D-NY) submitted his (and Senator McCaskill?s) debt settlement legislation (S.3264) as an amendment to the Restoring American Financial Stability (RAFS) Act of 2010, the financial reform bill now making its way through the Senate. The amendment has been given the designation Amendment No. 3960.

A preliminary review of the Amendment reveals that the most damaging provisions of the bill – those relating to fee regulation remained intact despite recommended changes. Monthly fees in any amount remain prohibited, and the percentage of savings was revised insignificantly, from 5% to 10%, which is of course still untenable. More specifically, if proposed Amendment 3960 is passed through the RAFS Act of 2010, debt settlement providers will only be allowed to charge (a) a $50 set up fee (fully refundable to consumers if programs are canceled inside three months; 50% refundable if cancellations occur thereafter prior to settlement), and (b) 10% of the amount consumers are saved, and only then on settlement and payment by creditors.

Additionally, if 3960 is passed, companies that are able to stay in business, if any, will face unlimited punitive damages in civil causes of action. This means juries will be free to impose limitless amounts of damages on companies in their discretion.

Finally, although debt settlement providers shall not be allowed to charge any monthly fees, providers are required under 3960 to create and provide monthly statements for all consumers enrolled in their programs. These free monthly statements must include ?account balances, fees paid, settlements completed, remaining debts, and any other term considered appropriate by the Federal Trade Commission.

In short, this bill, developed in secret over the last 9 months and now being slipped into other legislation without even a hearing is designed with one purpose in mind: to eliminate the debt settlement industry. This is an extreme and ridiculous law.

What we need from you, is for you to step up your calls to Senators urging them to oppose Schumer-McCaskill Amendment 3960. If you have consumers who want others to have the same access to debt settlement programs that they have had, and if they wish to contact Senators, as well, we need their input delivered to Senators, as well.

SENATOR	PHONE
Senator Richard Shelby – AL (R)	(202) 224-4224
Senator Bob Corker ? TN (R)	(202) 224-3344
Senator Kay Bailey Hutchison ? TX (R)	(202) 224-5922
Senator John Cornyn ? TX (R)	(202) 224-2934
Senator Jim DeMint SC (R )	(202) 224-6121
Senator George Voinovich ? OH (R)	(202) 224-3353
Senator Even Bayh ? IN (D)	(202) 224-5623
Senator Ben Nelson ? NE (D)	(202) 224-6551
Senator Christopher ?Kit? Bond ? MO (R)	(202) 224-5721
Senator Scott Brown ? MA (R)	(202) 224-4543
Senator John Kyl ? AZ (R)	(202) 224-4521
Senator Arlen Specter ? PA (D)	(202) 224-4254
Senator Susan Collins ? ME (R)	(202) 224-2523
Senator Olympia Snow ? ME (R)	(202) 224-5344

The next few days will be critical to this effort, so keep up the great work. It only takes 5 minutes to call each of these senator offices and express your disapproval of this ridiculous law that would crush the industry into not being able to help people settle their debts like they have been for years and years. Not only that, but the banks historically earn more money from debt settlement than bankruptcy.

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Some people just thrive on talking smack in the case of Steve Rhode, the self appointed get out of debt guy who claims to help you get out of debt for “free”. The truth is he wants you to come to his site so he can sell your information as a lead to a debt consolidation or debt settlement company; the same companies he enjoys bashing. Unfortunately the company he recommends was sued for violating Illinois state law.  (Sorry to hear that Cambridge.) Steve is no stranger to getting in trouble with the law such as the case with the state of California issuing a desist and refrain order for his unlicensed bill payment software .

Steve’s personal life experience led him to bankruptcy which is a scenario I consider as the absolute last option since it wrecks your credit for ten years in most cases, not to mention you have to jump through all sorts of means testing hoops based on income and state guidelines. Hiring an bankruptcy attorney in most cases will stick youin a Chapter 13 scenario where you have to repay quite a bit of your debts back and relinquish control of your assets to the courts. You also will have an even more difficult time in finding a job with a bankruptcy on your credit report for ten long years instead of 7 years if you did a debt settlement or a credit counseling program that does not affect your credit score since you’re truly trying to resolve your debts.

Steve misinterpreted my quote in a press release stating “As of October 17, 2005 all Americans seeking bankruptcy must complete a credit counseling program. The problem with this is that so many people are unable to afford the monthly payments in a credit counseling program, and must seek debt settlement.”

I never implied that seeking bankruptcy and completing an education course delivered typically by credit counseling groups in order to qualify for bankruptcy meant you enroll in debt settlement.  Duh! That class is required 180 days prior to acceptance in a bankruptcy. I never said the class forces someone to enroll in debt settlement. My key point of the press release was that many people are unable to afford the payment in a credit counseling program, and thus must seek debt settlement.  Steve’s quick advice is to tell everyone to jump into bankruptcy because it worked for him. I find that foolish.  If you could pay back your debts in 4 years with interest rates between 0-9%, why wouldn’t you do so in a credit counseling program? It doesn’t crush your credit score if you pay back your full debt on time and in full. 35% of your credit score is measured by making payments on time, and 30% is measured by your debt to income.

Should we all just give up and jump into bankruptcy? Ridiculous. Remind me not to be on a sinking boat with you Steve.  If our clients cannot afford the credit counseling payment, the debt settlement payments are half of that.  For example, on a $50,000 credit card debt, your payments are around $1,100 to $1,500 a month.  If your interest rates are above 18% and you are making minimum payments, you will never paid that debt off. However, depending upon the creditor, we have arrangements with banks like Advanta, First Premier, Tiresplus, and Firestone to drop your rates to 0% interest as long as you make your payments on time.  The payoff time is 4 years or less in most cases.  If you can’t afford that payment, your payments could be as low as $641 over 48 months and you would save 30-40% of the debt amount since we have over 200 attorneys nationwide at our disposal.

Not to mention debt settlement historically yields a higher return to the creditors . (See Briesch Whitepapers and Weinstein Whitepaper)  Debt settlement certainly yields more money to banks than than bankruptcies or judgments, which is why they work for both parties not only to heal our economy but more importantly, help our clients resolve their debts and send their credit score back up. I’ve personally done a debt settlement and I’m happy to say my credit score isn’t trashed because I listened to some poor advice from the quick yet devastating bankruptcy advice from Steve Rhode.

Yet Steve is more than happy to capitalize off selling leads off his website to debt management companies like Cambridge Credit Counseling , which was  sued for violating one of Illinois’s latest state law revisions on limiting debt management upfront fees.  Steve to me is just a wannabe Dave Ramsey who’s hoping his balding appearance and sob story about bankruptcy will capture audiences and more importantly, LEADS so he can then sell to make money off you.  (Personally I like Dave Ramsey and most of his advice in regards to financial discipline but I don’t believe he understands there are some legitimate credit counseling and debt settlement companies out there, helping people get out of debt.)  The entire first half of his Steve Rhode’s website is riddled with Google Adwords links that pay him everytime you click them like some worthless spam site so he can earn money every time you click them.  (We have them too but they don’t cover the entire first half of the page; we find that annoying.)

Funny Steve. If the debt settlement companies are so bad, why don’t you just take down your referral form  Isn’t supporting them hypocritical?? You of all people should understand the demand and need for people to leverage income in this recession while providing a valuable service for their clients through debt management and debt settlement services if they are indeed a fit for the programs.  Our press release was written to mortgage brokers who are hurting in this economy and don’t know what to do with their dead leads.

Affiliates don’t need special licensing at this point in time to refer business to debt management companies in most states but the laws are changing since debt management has been the wild west.  Several states are beginning to require licensing to even talk to their residents, but not all.  South Carolina, Minnesota, and Illinois are a few of the states requiring even companys that refer business to credit counseling companies to be licensed and registered with the state.

We welcome debt management laws in regards to requiring educational courses like the few states currently do in this wonderful nation.  Steve, I doubt you’re licensed or much less know about the new state laws.

As for your idiotic remark about the attorney general, I’ve met him. He’s a nice guy.  And to clarify, we are not a debt settlement company.  We train and teach affiliates the proper way to counsel and qualify people for debt management and settlement programs so they can make money just like you’re trying to do so they can focus on their core business. DebtManagementGuys.com utilizes over 200 attorneys nationwide ensuring only attorneys approve our clients truly belong in debt settlement programs, and if they truly are not a fit, guess what? They recommend bankruptcy if there is a true financial hardship that debt settlement cannot offer.  No one can provide debt settlement services in Georgia unless they are attorneys which is why we ONLY use attorneys.

We’re also proud to say that our attorneys are averaging a 30% settlement on our client’s debts, and only went over 40% twice last year, which is 12% below the industry average. Credit Solutions of Texas boasts over 100,000 clients and their average is 41.6%.  As for our debt management credit counseling clients, our processor maintains an 87% retention rate and actually purchases clients from debt management companies that are shut down due to noncompliance since they have to be serviced by someone. They also have an A rating with the BBB.  So no Steve, we won’t be shut down because we let an A rated processor do what they do best as they are licensed and bonded in every state. We speak to every client that is referred to us to make sure they truly belong in the proper program rather than hustle them off into a program they don’t need.

Steve, perhaps you should take a basic phonics course and not skim our press releases, but rather read the entire article.  With over $395,000,000 in delinquent credit card debt, this country needs help from ethical debt management providers who truly care about their clients, and thats exactly why DebtManagementGuys.com was created.  People need jobs and helping people get out of debt, just like you’re trying to do, is a very rewarding career path. At the end of the day, we’re held accountable for our actions which is why we do everything by the book.

Perhaps if you spent more time on helping people and less time talking crap about things you don’t understand, you might learn something.  As for us, wesleep great at night because our clients are truly helped. Maybe you can take some of your adwords revenue and seek hair replacement therapy,  Dr. Cole here in Atlanta is an excellent hair replacement surgeon with his revolutionary Follicular Isolation technique. We wouldn’t mind throwing a few cents in your direction.

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As we? have explained in a previous post many banks are dishonest to their cardholders claiming they do not work with debt settlement companies in an effort to cause fear and doubt. This is clearly an effort to strike fear into the hearts of the account holders so you return to? paying the excessive interest and finance charges.

Consider the lie in their statement, ” We don’t work with debt settlement companies, but we’ll offer you a settlement.”? Exactly! They want you to try to negotiate with them so they can get more money out of you, or you could use our seasoned attorneys to achieve a much lower settlement. The choice is yours.

In the bank’s defense credit cards are their highest risk being? unsecured by any property or assets, but saying they do not agree to settle for less is just downright dishonest. We thought we would share a few settlement letters from different creditors who have indeed settled for less.

The following settlement letters are from creditors such as Bank of America, First National Bank of Omaha, Capital One, Washington Mutual, Discover, and more. If you have been jerked around by your bank’s? service fees, interest rates, and never seem to see that credit card balance go down, give us a call us today for a free, no obligation quote to find out what you qualify for. At the very least you can walk away being a little smarter about the industry. See for yourself below.

Chase Debt Settlement Acceptance Letter

Call 678.561.DEBT today to eliminate your debt and sleep better at night. We’ll put you on a payment that you can afford rather than have the courts or banks tell you what to pay, and not wreck your credit like a bankruptcy can.? You are paying your creditors back in this program, but on your terms, not theirs!

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Does credit counseling hurt my credit score?

This is a very popular question we receive regarding your credit score. Its important to know how your credit score is calculated to explain this answer in detail so let’s dig in.

• 35% of your credit score is measured by making payments on time
• 30% of your credit score is measured by your dti (debt to income) – the more debt you have the lower your score

The rest of your credit score is measured by how many accounts you have open, how long they have been open, and other factors.? According to MyFico.com, credit counseling does not hurt your credit score. Debt management programs have an enrollment fee and its important to know that the first payment does not go toward your creditors. Its not until the second payment drafts out that the funds are distributors to your creditors as it typically takes 30 days to set everything up for your lower interest rate, which takes anywhere from 1 to 3 months of payments on time before it kicks in, depending upon the creditor.

Debt settlement on the other hand does not make payments regularly to your creditors, but rather makes payment into a settlement account where a lump sum grows.? The lump sum allows? the law firm or yourself to have better negotiating power to offer a settlement amount.? Creditors can sue you if they like but its costly for them and counterproductive. You can also owe a tax liability for the amount of money you did not have to pay. If your tax rate is 15%, $5,000 of forgiven debt will carry a $750 tax liability. However, you can petition? a waiver from the liability if your assets are lower than your liabilities by filling out form 932

To find out more about the pros and cons of debt management and settlement services, visit Debt Management Guys .com to speak to a live representative by clicking the Call me button, entering your phone number and hitting connect. Or you can simply fill out the form to request more information, or by simply dialing 678.561.DEBT today. You have nothing to lose and only options to gain.

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