|Katherine:||Hello everyone. Thank you so much for joining us today on This Needs To Be Said. Our friend attorney Peter Daigle is here with us today to continue the conversation on debt settlement. Y’all remember last time I got a little confused. We’re going to talk about debt settlement as a solution to your financial woes. And today we’re going to cover a frequently asked questions which is my favorite. Y’all want to know what other people are wondering. Peter, welcome back.|
|Peter Daigle:||Sure. Well, thanks Katherine. And feel free to jump in with any of your questions also. Okay? Because you’re probably thinking in the mind of a listener here. So the first question we’re going to answer is how does it affect my credit? Okay. Because one thing everybody wants to know is what happens to my credit? Well, there’s no question that the issuance of a bankruptcy discharge, it can’t be anything.|
It’s the best thing that could happen to your credit that’s been bruised because the credit report reverts back to like you’re 18 years old again. Okay? It’s simply clean and it doesn’t quite happen so good with debt settlement. In fact, the best we could get is that the creditor, as part of the settlement, will agree to report on a credit bureau that the debt’s been settled. Okay? So a debt being settled is certainly not as good a credit score as being paid as agreed or being discharged in bankruptcy. Okay?
When you’re discharged in bankruptcy, it vaporizes from the actual credit report. Reporting as settled will still stay on the report. So the bad news so to speak with debt settlement is that your credit is still gonna remain somewhat bruised for a while, but over time, folks when looking to lend you more credit will see on the credit that the debts have been settled, the debts have been settled. So they’ll have gone from a charge off status to a settled status.
So that will actually help you more than just being the charge off status. But in any event, it’s still definitely not the best way to go in terms of having the best credit. Okay. So I want to make sure the listeners understand that that the benefit to settling a debt is that you get rid of the debt for less than what you owe and get the creditor to stop calling you, but it doesn’t heal as quickly on your credit report as if you’re paying them, paying it off. Okay? So, a lot of times this is something that you left with no other alternative. In other words, you can’t keep making minimum payments for the rest of your life. You don’t want to file or can’t file bankruptcy, so you have to do something and so…
But the credit would definitely take a hit by doing the debt settlement. Okay. So that’s one of the frequently asked questions that I have. Okay? So the next question is what do we sell these debts for? Okay. And what’s the percentage? And overall percentage is ones that are 50% okay? So that means that some of the debt we do, we can do at 20% and some at 70%. If it goes to a lawsuit, a judgment it’s closer to 70% if it’s with a collection agency, a lot of times we can get rid of it for 20 to 30% or 40% okay? And what we generally get is we get a hardship letter, a letter stating that that these are the reasons why you can’t continue to pay the debt. We’ll wave that hardship letter at them to show that this is all you’re going to get okay…
And because of the fact that we’re a bankruptcy law firm, if they look us up, they can see that that’s the alternative. And in fact, we’ll tell them that. We’ll say that, “Listen, you’re either going to get this, which is let’s say $2,000 on a $10,000 debt or you’ll get nothing in a bankruptcy. So one of the questions that we ask is how much do I have to pay? And the rule of thumb is going to be 50% okay. Okay?
|Peter Daigle:||The third question that comes up a lot is how is this administrator who’s administering it? And what makes us different than any other debt settlement companies? It’s being by a law firm and so we have the ability in Massachusetts to deal with lawsuits and other aggressive wage garnishment, bank account attachments. So, when you hire a law firm to represent you, they have the keys to the courthouse so to speak and they can deal with you on matters that essentially like an out of state company, a debt settlement company or a debt consolidate can do it because if you sued by just a non- attorney, then they don’t have that same ability to defend the suit. Okay?|
So one of the questions is that what do I do if I get sued or what if somebody comes after me? The answer is with our firm, we have the ability to defend you. Okay? The representation includes working something out from that. I mean obviously that would not be a first choice. Our first choice would be head it off and settle the debts, but we just don’t know what’s going to happen down the road. So anyway, that’s one of the questions we get is what happens if I’m sued and what do I do and the answer is you’d have us help you. Okay?
|Katherine:||Can I jump in because I do have two questions because the more we talk, the more curious I get because you talked about the different kinds of bankruptcy that I could file. You talked about the other options other than bankruptcy that I could use. So I’m looking at this spread of information in my head as you’re talking about it. And is any of this based on how fast I want the problem to go away? Cause you said something like some stuff people may let sit and it made me think, is it a timing thing? Is this something that would fall off or like is timing a part of the equation when you decide to file or not?|
|Peter Daigle:||Well that’s a great question. Each one of them is different. Each one’s different. Okay? It’s this whole … one sec. So yeah, so each one of them is different and each one of them it would be, it really depends on the creditor. So for instance, whether it be Bank America or Citibank or Capital One or a collection agency, historically, we know what each one is going to take. Okay. And we know, for instance, what the percentage is that we most likely settle for. So when we start the representation, we try to have some sense of who these folks are and how difficult it’s going to be. Okay? And that’s just based upon historical, you know?|
|Katherine:||Okay. Okay. I was wondering, like for me, I want this to go away really fast and you say, okay, this is what you need to do or because of debt settlement.|
|Peter Daigle:||So here’s what happens. If you’re current with the card, they’re not gonna talk to me. They don’t even want to hear from me. Okay? So you have to let it get stale. Okay? Because if you’re making your payments on your credit cards right now and you call them up and you tell them you want to give them 50% they’re going to laugh at you, the phone call. Okay? They’re going to say, “Oh, Katherine, you’re a great customer. You pay every month you for everybody. Why are we going to give you a break? No I don’t think so. Yeah. We’ll tell you what we’ll do. We’ll suspend your payments for a couple of months or three months. And maybe we’ll lower the interest rate couple of percent, but no you’ve got to pay us back.”|
So the difference between hiring a law firm or a professional is that because we say to them, “Listen, she’s just not going to pay you back period. So you gotta kinda get that upfront.” And the reason why we can say that is because we’re going to tell you to stop making the payments. Okay? So once you start made three or four payments, we’re going to call Bank Of America. We’re gonna ask them to close the account. We’re going to say, “Listen, she’s not paying you now, she’s never going to pay you.” And the good news when they close the account is that the interest stops. Okay? And so when I ask them to close the account and then if they want to charge it off, whatever their internal policies are that they can do that. But unfortunately had to let the debt get little stale first. I know that sounds like-
|Katherine:||Well I mean it sounds like it’s a timing thing. I mean, because if I’m able to pay it on time, it doesn’t look like a need, but it’s a shame. Well, maybe you’re getting punished for being good or maybe listeners, maybe you can call your credit card company and say, “I’ve been paying good. Can I get a couple of suspended months?” I don’t know. But it sounds like timing is everything.|
|Peter Daigle:||Exactly. Yeah. No, it’s really what it is. And so you have to be somewhat patient. Okay? And you have to say, “Look, I’m going to put this in the hands of a professional. I’m not going to think about it anymore. I’m just gonna let them handle it.” And that’s really what we would recommend and just continue to fund the account each month. If you have our office work with it, the money goes in an escrow account. You send a statement, the accounts in short, and then we go over the settlement proposal with you. So for instance, if you will discover $10,000 and they have an offer of $2,000 we’ll call you up and we’ll say, “Hey listen, Discover will take two.” And you’ll say, “Great, let’s do it.” Or oh, they want five. And we’ll say, “Well let’s wait a little while longer.” And so we’ll have these discussions each time on each one of these creditors that goes down. Okay?|
So the next question people always ask is well, what about if this doesn’t work out okay? And well, bankruptcy is always an option if this does not work out. Okay? So there is another way around it. And that is if no matter how hard you try, you can’t continue to fund this account each month. Let’s say for a second, the payment is $500 a month and because you want to settle the debt, you don’t want to file bankruptcy and then you lose your job or you get cut back in hours or have a health issue. And so you always have the ability to convert to a bankruptcy. Okay? So at least you know that this is going to be end to this, that it will go away at some point. So it’s not like you’re gonna be stuck with this debt forever. Okay?
|Peter Daigle:||Any other questions? Do you have it all?|
|Katherine:||Well I want to know why do we get so emotional about stuff because when you said the hardship letter, I was like, “Oh no, I have to admit I did bad,” My mind does crazy things when you’re talking, but I know it’s part of the process because you explained it, but it’s like, “Oh, I have to admit that I can’t do it on my own.” Why do we get so emotional is my question?|
|Peter Daigle:||Well I think because I think we’re all from the time we were brought up by our parents we’re taught to be a fighter in whatever it is. Fight to do the best you can. And so when all of a sudden you fall short, there’s a sense of guilt. Like, “Oh my mother told me to pay my bills on time. My mother told me to finish my food when it’s in front of me.” Whatever the case may be. So we’re all domesticated, so to speak, as to how we’re supposed to feel. And so, when we’re not paying as agreed, we feel like we let somebody down. So that’s the human condition, you know? But you know.|
|Katherine:||Yeah. Right. Well, you’re one of the people I would recommend to go to. You’re definitely kind to me. You’re just going to have to practice in North Carolina and I’m going to have to use you for something, but you’re so kind to the people who need your services and that I almost want to be in trouble so you can help me, Peter. That’s what I think. How do people get in touch with you outside of this interview?|
|Peter Daigle:||Sure, Katherine. They can call our main number at (508) 771-7444 and we can schedule a phone conference or you can reach us on daiglelawoffice.com through our website. You can order our book. You can read all about bankruptcy and debt consolidation on the website, the blogs, and also you can request your copy of the book that I’ve written.|
|Katherine:||And it’s a great book. Yeah, yeah.|
|Peter Daigle:||Well thank you. So either way through the website or the number that I’ve given you would be a way to get ahold of us.|
|Katherine:||Absolutely. Well. Thank you, Peter again for being our guest, and until next time, have a super day.|
|Peter Daigle:||Okay, thanks, Katherine. Bye bye.|
|Katherine:||Okay, thank you for tuning in to This Needs To Be Said. I hope you’ve gained something from what has been shared. Send me your comments and show ideas through the website at TNTBSmedia.com. I’d love to hear from you.|