Thursday, January 2, 2014

Take control of your debt in the New Year!

          Are you “robbing Peter to pay Paul?” Most people that fall into situations of extreme financial difficulty did not do so intentionally. I often tell people that many do not realize how close they are to the edge of financial ruin, and it only takes one unfortunate life event to push them over the edge into a whole out of which they cannot climb. A trip to the hospital, the birth of a child, loss of a job, or a reduction in pay are some of the most common and significant life events that place people firmly within that whole.

            The first response many have is to buckle down, and scrounge together every penny they can to keep current on their minimum payments. This is a good way to handle financial difficulty, if it is temporary and things improve. However, in so many circumstances the conditions never improve, or they improve too late. People begin to miss minimum payments on credit cards, which results in late fees and a sharp increase in interest rates as high as 29.99%, the definition of kicking someone while they are down.  Then their bank account gets overdrawn, whereupon the bank charges overdraft fees, and payments begin to bounce. Routine trips to the doctor’s office or dentist, or a refill of prescriptions, not covered entirely by insurance result in medical bills that can’t be paid. Lastly, people start falling behind on car and/or house payments, and secured debts fall into foreclosure and repossession. This is when things have truly spiraled out of control, and it marks the beginning of the end of an individual’s or family’s financial security.

            Once a person can no longer make minimum payments on credit cards or medical bills, they go to collections. This is one of the most unpleasant things, financially and emotionally speaking, a person can go through. People feel ashamed and embarrassed, and debt collectors only make them feel worse, pressuring them into making payments on bad debt with money they need to survive. The stress of trying to make ends meet in combination with the harassment and shame result in many burying their heads in the sand. They cannot bring themselves to open the mail or answer the phone. Every time the doorbell rings, their heart sinks, because it could be a process server serving a lawsuit. Unfortunately, there really is no way to recover once things have become this bad.

            Some don’t even back down when things have gotten this bleak. In a last ditch effort to try to make ends meet and get their finances under control, they take out payday or personal loans with extremely high interest. Eventually, they can’t stop borrowing, because if they do they can’t pay even their most basic needs, like food, rent and utilities.

            Sadly, this is an all too familiar story that we hear on, nearly, a daily basis. However, a person does not have to suffer so much for so long to get relief. We can help at the outset of financial difficulty, and help people get their life back. If you are starting to miss payments or receive collection calls, contact us to discuss your debt relief options at 503-352-3690. If we think you can make it work or don’t need to file bankruptcy, we will tell you. We do not push every person that walks in the door into bankruptcy, because we want to do what best serves the needs of each person. Consultations are free, so there is no risk to you. Don’t spend another dollar or sleepless night on bad debt. Visit us at