The following guide will show you how to get out of high credit card debt in 2019. Learn multiple options and choose the plan that best suits you. The information is provided by Paul J Paquin, the CEO at Golden Financial Services.
Table of Contents: (here’s what you’ll see inside this post)
- Chapter 1: What’s the main reason why people need help with getting out of debt?
- Chapter 2: Why most people choose debt validation
- Chapter 3: See example letters, showing how validation resolved high credit card debts
- Chapter 4: How debt validation can resolve credit card debt
- Chapter 5: Have you heard the story about Felicia Tancreto, regarding the American Express lawsuit?
- Chapter 6: Debt relief programs that don’t hurt your credit score
- Chapter 7: How to Pay Off Credit Cards Fast?
- Chapter 8: Debt Settlement to Pay Credit Cards Fast
- Chapter 9: Why is it more beneficial to use a law firm to settle your debt, versus a non-attorney plan?
- Chapter 10: Debt Validation: The Program with Highest Savings
- Chapter 11: But don’t I have an obligation to keep paying every month?
- Chapter 12: Make it your New Year’s Resolution to achieve financial freedom.
- Chapter 13: What happens when you call Golden Financial Services?
Golden Financial Services surveyed 8,000+ clients to figure out:
What is the main financial hardship that leads to a person having high credit card debt that they can’t afford to pay?
We heard all kinds of answers:
“I had a mental breakdown”
“Got sick and hospitalized”
“I recently went through a divorce, moved, and moved again because I could not find a job …”
“Disabled and only working part-time … and fell behind on credit cards”
“Going on Disability…”
“I’ve been paying minimum payments for years, but the balances are not going down…”
Medical, divorce and people getting laid off from work are amongst the three most common financial hardships that people in the United States are experiencing.
Medical Problems: the #1 Reason Why People Need Debt Relief
It starts with getting medical treatment for an unexpected medical condition.
You end up paying off the medical debt with a credit card.
Medical expenses, soon lead to high credit card debt.
Minimum payments rise and you can no longer afford minimum payments.
What to do with high credit card debt, caused by medical expenses?
At this point, it can feel as if you hit a brick wall. But the good news is, debt validation can offer you a solution.
Medical conditions are unexpected. Normal people don’t plan to save for unexpected medical expenses – or divorces – or layoffs. So, when these types of conditions occur, people are caught off guard, and often use credit cards to pay the bills that pop up.
Eventually, the credit card payments become overwhelming, and at times unmanageable. Even worse, people will pay only minimum payments and never get out of debt due to high interest. And their minimum payments are still hurting their credit!
If this is YOU:
YOUR LUCK may quickly change!
Millions of Americans struggle to pay their credit cards, due to medical conditions or other unexpected circumstances that caused the debt in the first place. Let’s look at the pros and cons of the different debt relief options out there.
Once we explain all available options to people, most will choose Debt Validation.
Validation will expose your creditors if they are illegally attempting to collect on a debt.
Here’s an example: The client used debt validation to resolve a Bank of America credit card debt that had a balance of over $10,000.
Using debt validation, this next client was able to get out of almost $20,000 in credit card debt that was owed to Wells Fargo.
What type of debt qualifies for a debt validation program?
- Citibank, Capital One, Wells Fargo, Bank of America and almost all credit card debt besides for Discover (Discover could be included on another plan)
- Medical bills and third-party debt collection accounts that have a balance of over $750.
- Almost any type of unsecured debt, including bank loans that have gone to collection
- Financial company loans like Prosper
This client was able to resolve a high-interest personal loan from Prosper Funding. The total debt amount was allegedly for $12,255.84. After getting disputed with validation, the collection agency immediately agreed to stop collection on the account.
Here’s another example of a medical bill that was disputed and resolved by validation.
Why does debt validation work for so many kinds of debt, with just about any consumer?
Have you heard the story about Felicia Tancreto?
American Express claimed that she owed $16,000 in credit card debt and even went as far as issuing her a credit card summons.
Noach Dear, a civil court judge in Brooklyn, later dismissed the lawsuit, citing a “lack of evidence“.
The American Express employee who testified “provided generic testimony about the way the company maintained its records. The same witness gave similar evidence in other cases.”
Following this case, it was concluded that “90 percent of credit card lawsuits are flawed,” meaning, creditors can’t prove that a person owes the debt.
Judge Dear stated, “Lenders are churning out lawsuits without regard for accuracy and improperly collecting debts from consumers. The concerns echo a recent abuse in the foreclosure system, a practice known as Robo-signing.”
Banks use Robo-signing to produce similar documents for different borrowers, without reviewing them, leading to inaccurate information.
As of 2018, lenders across the nation are facing major scrutiny.
According to an article in the Washington Post, amongst other sources, “The Office of the Comptroller of the Currency is investigating JPMorgan Chase after an ex-employee revealed that nearly 23,000 past-due accounts had incorrect balances.” This investigation has been ongoing since 2011.
If your number one goal is to stay current on credit card payments, without even a temporary dip in your credit score, debt validation is not the right option. Let’s look at debt relief options that don’t require you to be delinquent on payments. We will then continue talking about debt validation benefits below.
But in the meantime, keep this in mind if you are considering debt validation:
- 1.) Your credit score has already been adversely affected if your credit cards are all maxed out due to high balances. Therefore, people seeking debt relief are often past the point of being concerned with their credit getting affected.
- 2.) Credit repair is part of the program.
- 3.) It only works because creditors so commonly engage in illegal practices.
Debt Relief Programs That Don’t Hurt Your Credit Score:
- 1.) Can I pay a credit card with a credit card?
Balance transfer cards offer you another way to consolidate debt. You can use a balance transfer card that offers a 0% interest rate for up to 18-months. If you pay off the balance within that 18-months, you can eliminate all interest.
Interest is a silent financial killer. Don’t let yourself fall victim to it.
Keep in mind, with balance transfer cards you will pay an upfront fee that will cost approximately 3%-5% of the total debt amount transferred onto the card. If you transfer $100,000 of credit card debt onto a balance transfer card, you could owe a $5,000 upfront fee.
- 2.) Should I get a consolidation loan?
Debt consolidation plans offer you minimum savings because you are only saving money on interest, at best.
How and Where to Get Loans For High Credit Card Debt:
- Must Have a 700+ Credit Score to qualify
- Try to get one from a bank or preferably a credit union (due to low rates)
- Avoid most online lenders, due to high fees (example: Lending Club and PayPal Loans for high credit card debt, come with high interest and additional fees)
- Click here to read more on how debt consolidation affects your credit
- 3.) Should I use Consumer Credit Counseling?
Besides using a loan to pay off debt, you can use a consumer credit counseling program which won’t negatively affect your credit score. However, this is another program that offers only partial savings.
More information on Consumer Credit Counseling
- 1.) This plan is only for credit card debt.
- 2.) You can become debt-free in 4.5 years
When it comes to debt relief, very few people choose these plans. You can save more on debt validation and negotiation.
How to Pay Off Credit Cards Fast?
When this question is asked, most debt relief companies quickly spill out some pitch about debt settlement.
The T.V. and radio ads that say “Call to Get Your Debt Forgiven” are referring to a debt settlement program.
But a debt settlement program should only be a last resort, used to avoid bankruptcy. After you settle a debt, your credit report shows the late and collection marks for up to seven years.
Since this program is so popular, let’s talk about this option first.
Debt Settlement to Pay Off High Credit Card Debt Fast
Debt settlement services let you pay off an unsecured debt for less than the full balance owed.
You get additional protection when using a law firm to settle your debt.
Golden Financial Services recommends using only an attorney-based debt settlement program.
There are two main reasons why:
- If your creditors are told that an attorney is representing you, according to the Fair Debt Collection Practices law, they must now direct all communication to your attorney.
Since you won’t have to deal with creditor harassment, you will have additional relief.
- Credit card companies and debt collectors violate peoples’ rights all the time.
Why does this benefit you as the consumer?
When using a debt settlement law firm, the law firm educates you on consumer laws and debt relief.
You will be trained by the law firm on how to spot and report any legal violations that your creditors commit.
An attorney can then use these legal violations as leverage when negotiating to reduce a debt.
Attorneys can also sue a debt collection company for an FDCPA violation, where you could get awarded up to $1,000 per violation.
In some cases, an attorney can even use legal violations to get a debt dismissed, which only an attorney can do.
Debt Validation: The Program with Highest Savings
A debt validation program potentially lets you pay much less than if you were to settle a debt.
Debt validation can also get the debt and its associated negative marks removed entirely from your credit report.
Here’s a debt validation example letter:
Notice the creditor agreeing to release $4,376.39 of credit card debt and remove the entire debt from Experian, Equifax and Transunion credit reports.
How debt validation can help you deal with credit card debt:
Debt validation challenges each of your debt collectors, forcing them to prove that they are legally authorized to collect on a debt.
Validation isn’t saying “I never spent the money”. Debt validation is just making sure your creditors are abiding by the laws.
It’s difficult to imagine, but most of the time a debt collection company can’t prove that they are legally authorized to collect on the debt. So by disputing it, you’re now forcing them to either prove the debt is valid (which they can’t do), or they can agree to stop collection on it. If they don’t agree to stop all collection efforts, the collection agency could get sued for illegally collecting on a debt. Rather than getting sued, they quickly agree to stop collection, as shown here:
The New York Times recently reported, “Billions of dollars in student loans may be wiped out for tens of thousands of borrowers in the US because a lender didn’t keep track of the paperwork verifying ownership of the loans.”
Just like if you get a speeding ticket. You were probably speeding, right?
However, a lawyer can get that ticket dismissed. Dismissed, meaning off your record completely! All because the lawyer didn’t answer a question accurately or failed to hold onto required documents.
The same concept is used with debt validation. This program is truly one of the most effective options to deal with credit card debt in 2019.
Credit repair is included in this plan, so once your debts are all invalidated, the credit repair will dispute the negative marks that don’t belong on your credit any longer.
But don’t I have an obligation to keep paying every month?
If you want to and you are able, you can. However, keep in mind how the debt collection process works – the original creditors get their money either way.
If your accounts are already in collections:
This means that a company that you never signed a contract with, never agreed to do business with, is trying to get money from you. Whenever asked, they are legally required to be able to provide certain proof of their right to collect from you – and they don’t have it.
The people you agreed to do business with have already been paid by their insurance and through tax credits/refunds.
You couldn’t even pay the original creditor if you wanted to.
If your accounts are still with the original creditor (for example, a bank):
You should know that they have insurance on the account, and you’ve been paying for it.
Part of every payment you make goes to their insurance.
Now if you pay for car insurance every month and someone hits you, then you file a claim, right?
Well in this case you’ve been hit by circumstances you didn’t know were coming.
If you let your accounts go delinquent, the bank will still get their money.
It will come from the insurance that you were already paying for.
Many people feel they still ought to keep making their scheduled payments, come what may, even if their current situation is completely unsustainable.
However, the federal government has consumer protection laws to protect people from having to keep struggling.
Why not use them and know that you did all you could?
Make it your New Year’s Resolution to achieve financial freedom.
Golden Financial Services has opened a nationwide debt relief helpline for consumers to call.
What happens when you call Golden Financial Services for help with credit card debt?
- You can talk with an IAPDA certified counselor for free and learn your debt relief options for 2019.
- We can pull your credit report for free and quickly go over which options you are best suited for.
- If you are eligible for a debt relief program, our expert counselors will work hard to get you approved and make the entire process easy.
- Golden Financial Services is accredited by Trusted Company Reviews, IAPDA certified, and Better Business Bureau A+ rated.
If you have past due monthly payments, you may be interested in this next post that talks about the statute of limitations on credit card debt.