11 Mar Economic Stimulus Package Does NOT Obligate Credit Card Companies to Settle Debts
This afternoon I heard a radio ad for one of those debt settlement companies. It was a company that apparently has the information that “the credit card companies don’t want you to know.” I have heard this ad many times before, but this time it had a twist. The ad implied that if banks received “bailout money” there was some implied obligation that those banks would be more amenable to settlement of consumer credit card debt for pennies on the dollar.
The ad did not come right out and say that consumer could now get a better debt settlement deal because of federal bailout funds, but that was clearly the implication. And that implication is totally dishonest.
I have read nothing whatsoever to suggest that credit card lenders who receive federal money will approach debt settlement differently at all. If anything, I think that credit card loss mitigation departments will carefully evaluate a borrower’s eligibility for settlement in difficult economic times.
In my experience a credit card lender will settle if the loss mitigation rep believes that full payment over time is less likely than partial payment now. The bailout or stimulus money reference is nothing more than a red herring.
by Jonathan Ginsberg, Ginsberg Law bankruptcy.
Jonathan Ginsberg, Esq.
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