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OP simply asked how using "Debt Free Associates" could reduce his/her debt works, merely mentioning the possibility of pulling monies from his/her 401k. Not once did OP suggest filing for BK, nor did OP state that he/she simply could NOT pay his/her debts.
Again, OP is asking for ideas as to how using a debt management company will help reduce their debt works. Since I have never used a debt management company, I can only give you information that I received from others who have in fact used one of these companies.
Googling Debt Free Associates shows they area debt SETTLEMENT company, not a DMP plan, So taking that into account, I'd agree, BK would be a better alternative than simply 'stiffing' their creditors, Use the power of the BK Court,
As far as the 401 goes, IF the OP is talking about taking a loan against their plan and has the ability to payoff their debt and enough working life left to repay the loan and will find themselves in very good financial shape at the end of the month, then that is an option,
If the OP is talking about cashing out their 401, Unless they have enough to pay all their debt PLUS the TAXES and PENALTIES for early withdrawal, If they don't have enough in the 401, then that is likely a very BAD idea!!!
Again, Not enough info from the OP but that is my take on the info provided,
Good Luck,
@Uniqua wrote:This thread is the classic example of why so many good threads with legitimate questions get locked!OP simply asked how using "Debt Free Associates" could reduce his/her debt works, merely mentioning the possibility of pulling monies from his/her 401k. Not once did OP suggest filing for BK, nor did OP state that he/she simply could NOT pay his/her debts. As a matter of fact, OP hasn't even been back to give more details about his/her credit situation. So, before we jump the gun and give OP bad advice, let's wait to get more information.Again, OP is asking for ideas as to how using a debt management company will help reduce their debt works. Since I have never used a debt management company, I can only give you information that I received from others who have in fact used one of these companies. From what I gather, most of these companies charge a monthly fee. They can do a great job negotiating with your creditors to reduce your monthly payments. However, since this debt management plan will be reported to the CRBs, your creditors (or potential creditors) may take adverse action against you by closing your CC accounts while you're in the plan and/or denying you credit should you seek credit during the plan. Will it have a negative affect on your credit score? Possibly. But, if you are already late in your payments, your score may already be affected. Your score will bounce back in due time as long as you are making timely payments. No one knows except you what your debt situation is and what is best for YOU. I, personally, would consider a debt management program before even entertaining the possibility of BK. Pulling monies from your 401k (as a loan) is a good idea, as long as it works for YOU. Remember, you are paying yourself back with interest. That doesn't go on your CRs and has no bearing on your credit situation. Again, only you know what is best for YOU.All the best!
We know nothing about the OP other then they are recently divorced, have 59K in CC debt and are considering a Debt Settlement company. We don't even know what gender they are.
Quite simply that is not enough info for anyone here to really give any qualified quantitative advice.
We have no idea his income, his obligations or anything else pertinent. is there child support?
The advice any of us is giving is like someone telling you his arm hurts and you telling him to go to the hospital he is having a heart attack when in reality he has a hang nail.
Reeling/adjusting from a divorce they could easily be making knee jerk reactions unthought out.
59K in debt and making 40k a year requires different guidance then 59K in debt and 250K a year.
There are certain situations a BK is great for, its allowed under law and completely legal. If he has $600K in his 401 K taking the 59K out may not be a problem.
The debt payment plan may be more onerous then a BK. Who knows.
heck he could be over the age where he can take the money out no penalty.
We simply do not know.
I have a 27 yo friend who's power of attorneyed wife put him 75k in debt when he was deployed. In 3 years and a re-enlistment it all got paid off. Yes there was heart ache but he is debt free now..
My sister and her last divorce was talking money hardship. At the same time she is talking money hardship (their combined income was over 220K and she makes moe then him when his child support was subtracted from his income) she let slip the bit about waiting for the sale of the plane and the 3 Harley's and how she had to cancel her two week trip to Italy she wanted to take that summer.
@haulingthescoreup wrote:
If "Debt Free Associates" is in fact a Debt Settlement/ Negotiation Program, rather than a Debt Management Program, discussing them here is a violation of forums TOS, as DSP's/ DNP's use unethical means of credit repair. Also, they cheerfully ruin your credit in the process.
Debt Management Programs are different, in that they negotiate APR's with your lenders, but you repay your debts.
So we can't get into details of "Debt Free Associates" here, other than to advise to run far and run fast.
For more info on all your options, read this.
It is and since it is I can't publish the information (link or quote) that proves it. Anyone can google the name and find out the bad news for themselves.
I found this in relation to the said company:
Over the years, our debt settlement services have helped many people avoid bankruptcy, ill-advised debt consolidation measures, and unscrupulous credit counseling services.
I cant speak about BK or consolidation but I am an example of a sucessful DMP'er. I still dont get the unscrupulous part of a DMP program. I guess lower interesat rates and the elimination of OTL and late fees is bad for one's financial health.
@marty56 wrote:I found this in relation to the said company:
Over the years, our debt settlement services have helped many people avoid bankruptcy, ill-advised debt consolidation measures, and unscrupulous credit counseling services.
I cant speak about BK or consolidation but I am an example of a sucessful DMP'er. I still dont get the unscrupulous part of a DMP program. I guess lower interesat rates and the elimination of OTL and late fees is bad for one's financial health.
These are two different things!
marty56 wrote:
I found this in relation to the said company:
Over the years, our debt settlement services have helped many people avoid bankruptcy, ill-advised debt consolidation measures, and unscrupulous credit counseling services.
I cant speak about BK or consolidation but I am an example of a sucessful DMP'er. I still dont get the unscrupulous part of a DMP program. I guess lower interesat rates and the elimination of OTL and late fees is bad for one's financial health.
@creditwherecreditisdue wrote:
@marty56 wrote:I found this in relation to the said company:
Over the years, our debt settlement services have helped many people avoid bankruptcy, ill-advised debt consolidation measures, and unscrupulous credit counseling services.
I cant speak about BK or consolidation but I am an example of a sucessful DMP'er. I still dont get the unscrupulous part of a DMP program. I guess lower interesat rates and the elimination of OTL and late fees is bad for one's financial health.
These are two different things!
I know that very well. I was commenting about the irony that a DSP would call a DMP unscrupulous. Kinda like people who spend our money irresponsibly yet ask us to live responsibly
marty56 wrote:
creditwherecreditisdue wrote:
marty56 wrote:I found this in relation to the said company:
Over the years, our debt settlement services have helped many people avoid bankruptcy, ill-advised debt consolidation measures, and unscrupulous credit counseling services.
I cant speak about BK or consolidation but I am an example of a sucessful DMP'er. I still dont get the unscrupulous part of a DMP program. I guess lower interesat rates and the elimination of OTL and late fees is bad for one's financial health.
These are two different things!
I know that very well. I was commenting about the irony that a DSP would call a DMP unscrupulous. Kinda like people who spend our money irresponsibly yet ask us to live responsibly
That's a good one.
It was difficult to tell what you were getting at. (Their statement or HTSU's comment.) Ambiguity kills.