Overwhelmed by debt; the common misconception of debt relief

On behalf of Bankruptcy Law Firm of Clare Casas on Tuesday, November 19, 2013.

As many Florida residents may be aware, debt is growing at an exponential rate. Most people know at least one person who may be struggling with some form of debt. Being overwhelmed by debt can have emotional effects on those who spend time with that person. To some people, debt is like a cancer, causing marital strife and feelings of despair.

To get out from under debt, many Americans have turned toward companies that claim to specialize in some sort of debt relief. Unfortunately, some of these companies play on the emotions of those who may be feeling like a failure when it comes to handling their money. In some cases, these people are depressed due to the weight of debt looming over them. These so-called experts may have their own agenda in mind.

Some companies offer services like credit counseling or debt reduction. Along with this comes the misguided possibility that the helpless feeling caused by debt may go away overnight. The problem with some companies, whether they claim to be non-profit, is that there is no current regulation to ensure that they act in a fiduciary capacity to help the consumer. The bottom line is that, with many of these debt settlement companies, the main reason they are in business is to boost their success rate.

While many companies do offer some useful debt-reducing and money-saving tips, very few offer sound financial advice that real people in debt sorely need – such as how to change your spending habits and avoid getting into debt again. These companies also fail to discuss the option of filing bankruptcy, which can eliminate debt and offer the filer a fresh start financially. As many Florida residents can attest, being overwhelmed by debt is no laughing matter, and understanding bankruptcy options may prove beneficial.

Source: Huffington Post, Why Debt Relief Help Is Broken in America, Steve Rhode, Nov. 13, 2013