Dave Ramsey, part 2 (or it’s not always what he tells you, but what he doesn’t tell you !)
I was listening to Dave Ramsey today, while eating lunch. A woman called in and said she had heard some folks tell her that she could settle with credit cards for a lesser amount than what is owed. While Dave told her that is possible, but not likely (since she was behind on the cards,according to him) what he did not tell her was something very, very important that we always tell all of our clients. Why Dave did not share this important information with her, I do not know.
What is that information that is so important? Quite simply, it is the fact that if you do settle with ABC Credit Card for a smaller amount, then the amount that you don’t pay them can be, and likely will be, sold to a debt buyer, lets call them XYZ Debt Buyer, and then XYZ Debt Buyer will likelycome after you years down the road for that debt. Now, the statute of limitations may prevent them from suing you, but they may still try to collect on the debt they purchased.
You see, XYZ Debt Buyer has purchased that, let’s say, $3000 debt that ABC Credit Card did not get from you (let’s say you paid them $2000 to settle a $5000 debt) for pennies on the dollar, or sometimes fractions of a penny on the dollar. So, any moneys that XYZ Debt Buyer is able to get out of you down the road is profit for them ! I have several clients a month that come in and are being contacted for debt that they thought they paid and settled, albeit only a portion, several years ago.
So, you see, when discussing your financial situation with a non-attorney, it is not always what you are told, but maybe what you are not told, that could be very important information that you need to help you decide what course of action to take.
