* Mistaken Belief #2: “Credit got me into this mess.”
Actually, spending money you didn’t have (or that stopped coming in) is what created the mess. Credit cards made it easier. So did mortgage companies, suggesting that you to take out a second mortgage on your home with a “home equity line of credit.” You were hounded to spend, and you spent. The easier it was to spend, the more you spent. The only problem was, what you were spending was somebody else’s money, money with strings attached. The villain in debt is not credit but overspending.
* Mistaken Belief #3: “There’s nothing I can do to stop the harassment and prevent a ruined credit rating.”
Simply not true. Hundreds of thousands of people have faced circumstances as bad as or worse than your own and have taken successful steps to reverse the situation. It’s a matter of getting the knowledge you need, then personally taking action to shake off the bill collectors and build your credit. Learn about money and credit. Learn how to dispute anything on your credit report that you don’t like. Find better credit options. Brainstorm ways to curtail your own spending. Start a new habit of paying your bills on time.
* Mistaken Belief #4: “I can’t change the information on my credit report.”
The Fair Credit Reporting Act tells you in black and white that any information on your credit report that’s not 100-percent accurate or that can’t be verified within 30 days must be removed. You can change the information on your credit report, without fear of any retaliation from anyone. It’s just a matter of getting the knowledge, then doing it.
* Mistaken Belief #5: “Filing bankruptcy is the only option.”
Bankruptcy is one option, but not the only option. There are ways to get out of debt for pennies on the dollar without the need to use an attorney, without placing hundreds of phone calls, and without much headache. With the knowledge of how to do it, you can settle your debts yourself in an affordable way or work through a debt-settlement service. But the debt-settlement service must work for you, not for your creditors.
* Mistaken Belief #6: “Filing bankruptcy will get rid of my debt.”
Unfortunately, bankruptcy laws have changed in the last few decades, making it more difficult to eliminate all your debt in a bankruptcy. Federally insured student loans, for instance, which used to be dischargeable through bankruptcy, are now held exempt in most cases. So even if you file, you may end up paying back a lot of your debt. Worst of all, a bankruptcy shows up on your credit report for 10 years. It’s much better to settle your debts if you can, getting creditors to write off portions of what is owed them, defer payments, or otherwise make your debt burden more reasonable to work with. There are ways to eliminate debt without attorneys and hassles. You only need to educate yourself on the best methods to move forward.
* Mistaken Belief #7: “I can work with the Consumer Credit Counseling Service (CCCS) to get hounding creditors off my back.”
Don’t be fooled. The CCCS, like many other supposedly non-profit groups, is in business to make money. They earn a 10-to-15 percent commission on all the money they collect from you while doing their presumed “charity work.” Creditors love to hear you’re working with CCCS, because this is a smaller commission than the 30-to-50 percent creditors would have to pay a commercial collection agency. CCCS has a track record of being loyal to creditors at the expense of debtors. This service does not work for you, but for those whose tactics have made your life miserable.
Ray Williams is author of “Debtor’s Secret Weapon,” over a hundred pages of detailed, proven strategies for eliminating debt, restoring credit, and taking back your life from the creditors who control it. For information on this book, visit www.outin90.com.
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