August 20, 2011
Questions and Answers for Individuals Contemplating A Debt Settlement Program
by Nick Vaccaro
Over the years, we’ve heard many reasons why somebody wouldn’t come into our program. If you’re contemplating a debt settlement program, and you still have some concerns, read the following. It may help to address some issues that you still have.
1. “Tomorrow”
- If you would have enrolled in my program 12 months ago, you would have already paid off about 33% of your debt. “Tomorrow” is today for the proactive person.
2. “I can do this myself”
- The banks have poured millions of dollars into advertising to make you think that you can do this yourself. It’s exactly what they want. They know that you don’t know the laws. They know that what you don’t know will be used against you.
- You may not know much about taxes, but your tax attorney does. Similarly, most individuals simply aren’t equipped to properly negotiate with creditors. Different creditors have different settlement rates. Different creditors settle better at different times of the month. How do you know what a good settlement is if offered? Can you do better than what they’re offering? We know what a good settlement is because we do this day in and day out. We’re non emotional. We know how to deal with each creditor. We know when the best time of the month is to settle. We know when they’re lying to us. We know the exact protocol to getting this taken care of the right way…the first time.
- By settling a large block of debt spread across many individuals, we command the ability to get a much better settlement than an individual that is trying to settle one account at a time. The collectors have been trained to harass you, and have been trained to detect if you’re lying to them. There are MANY strategies involved in settling.
Many people have been misled into thinking that they can address these issues themselves. The banks have poured millions of dollars to get the word out to you.
Remember, the banks are the competition; not your ally. If you play poker, does your competition tell you what he’s holding, or does he bluff you?
3. “I’m going to file for bankruptcy.”
In certain cases, I’m the first one to agree with this; when it’s absolutely necessary. Because we’re averaging at about 35 cents on the dollar, this means you’d be filing BK for a third of what you owe. Does this make sense? I encourage you to find out what we can get your payments down to through our program. If our payments are not feasable, then BK may be a better way to go.
If you can avoid BK, don’t file for BK. I have a number of BK attorneys that are currently clients in my program. What does that tell you?
4. “I’ve heard that debt settlments will damage my credit score.”
First of all, you’re really not concerned with your credit score, per se. What you’re more concerned with is your ability to property qualify for a loan. Your credit score in and of itself does absolutley nothing. What you’re really asking is, “What will this do to me when I try to get a loan”? That’s what a credit score is used for, right? When finished, my program will increase the odds of you getting a loan…if you follow my advice.
The 3 primary pieces of information that a bank uses to determine IF somebody is eligible for a loan is (in this order):
- Debt to Income Ratio (D.T.I). This is a measure of what your current income is relative to what your monthly payments are.
- Equity or down payment. How much blood sweat and tears do you have invested?
- Credit Score.
My program gives you a better DTI. How? By paying off your debt. This is the primary factor that the banks are looking for as a result of new lending guidelines; NOT CREDIT SCORE. If you have an 800 credit score, but can’t verify your income; you don’t qualify for a loan. Banks don’t do stated loans anymore. Cash flow is king.
If two people walk into a bank to get a loan, with the following situation:
- Borrower 1: Credit Score: 800. No money left over at the end of the month because of debt, car payments, mortgages etc…
- Borrower 2: Credit Score: 640. $1,000 left over at the end of the month because he’s managed his money wisely. May have one or two 30 day lates.
The bank will give the loan to Borrower #2 EVERY SINGLE TIME. How do I know this? I was the person in charge of getting people approved for a loan. I’ve personally pulled over 20,000 credit bureaus over the last 12 years. I promise you, I know what I’m talking about.
My program gets you out of debt. This improves you SCORE, but more importantly improves your DTI. Yes, your credit score will drop as a result of this program, but when done with the program, a good credit cleanser will get your credit score back up, and your debt will be gone. THIS is what the banks look for.
You won’t believe this: if you have more than $40,000 in debt, I’ll pay to have you put through a debt restoration program at the end of your program. I’ve contracted with a credit specialist who charges $1500-$2000 for credit restoration, and I’ll pay for 100% of your program. I challenge you to call around, and see how good of an offer this is. NOBODY in my industry is offering this. NOBODY.
5. “I’ve heard that debt settlements are a scam.”
Simply put, we can’t scam you. We only get paid AFTER your creditor has been paid off. The reason that most people hear so much negative publicity about debt settlements stems from three primary reasons:
1. A lack of information given to the client that originally enrolled in their program.
2. Upfront fees.
3. The banks have poured a lot of money into making you believe this.
I won’t receive a penny on your account for about 6 months….and this is only after we’ve paid off a creditor. I have to do a good job to make ANY money. Know that we’ve put together a program where it’s literally impossible for us to take advantage of you. You’re in control of your money at all times, we don’t get paid until after your creditor has been paid, and we have no cancellation fees. We’ve designed it so that it is a no brainer for somebody who is looking at getting out of debt. I can further explain it to you when we speak.
If you’re looking for help, and need further answers, I encourage you to contact me.
Nick Vaccaro
American Financial Protection Group
