According to an October 23, 2012 WVTM-TV article, it has been two years since the Federal Trade Commission (FTC) implemented new rules regulating the debt relief industry. WVTM noted that consumers are carrying $864.2 billion in revolving debt, and the average American with credit card debt owes more than $15,500. The Federal Reserve says the total household debt in the United States is $11.4 trillion.

While the FTC changes were good for the many consumers who need help with debt, WVTM pointed out four things to know when seeking debt relief:

1. Know what debt settlement is – Debt settlement plans can sometimes reduce total principals owed by about half, and the programs generally take two to four years to resolve a consumer’s debt. While WVTM wrote that debt settlement “can be helpful for individuals who are unable to make minimum payments on credit card debt ,” consumers must remember that debt settlement companies often engage in abusive practices. These abuses led Illinois lawmakers to pass legislation in 2010 that banned charging upfront fees for helping consumers negotiate relief from creditors. In July, one Chicago based firm agreed to refund $2.1 million after Illinois Attorney General Lisa Madigan said the lawyers were a “front” to collect hefty fees from desperate consumers.
2. Understand the FTC rules – The FTC rules “require debt relief companies to renegotiate, settle or reduce the terms of at least one debt, with the consumer’s agreement, before collecting fees from the consumer.” (WVTM.) The FTC rules also define the advertising claims these companies can make. WVTM pointed out that debt settlement companies need to disclose how long it should take to see results, program costs and any negative consequences that may result.
3. Know where to finding a debt settlement provider – WVTM noted that it remains legal for debt settlement companies and law firms that do not participate in telemarketing to charge up-front fees. The article recommended looking for a firm that is a member of the American Fair Credit Council (AFCC), which “enforces the strictest code of conduct in the industry,” according to WVTM.
4. Proceed with caution – “Consumers should look for a firm that has an established, long-term record of successfully getting results for customers,” WVTM said. The article cautioned that impatient debt counselors, high-pressure sales tactics and claims that sound too good to be true are all “warning signs of firms that should be avoided.”

If you are among the many households carrying thousands of dollars in revolving debt, you should know that filing Chapter 7 bankruptcy may allow you to discharge all of your unsecured debt in a matter of months. You can also catch up on late mortgage payments or reduce your mortgage principle by filing Chapter 13 bankruptcy . Both chapters can be safer alternatives to debt settlement programs, and our Chicago bankruptcy lawyers can tell you which plan would work best for you when you contact our firm at (866) 930-7482 or fill out the form on this page.

Benjamin Brand Services – Chicago bankruptcy attorneys

This Illinois Statehouse News video features Governor’s Office of Management and Budget spokeswoman Kelly Kraft, who Governor Pat Quinn chose to be executive director of the Illinois Sports Facilities Authority-the state agency that operates US Cellular Field. Chicago Mayor Rahm Emanuel, however, said he wants a person with experience in managing finances to run the agency, the Chicago Tribune reported. Kraft’s personal history with finances became an issue when the Tribune reported on October 5, 2012, that Kraft filed for bankruptcy after owing more than $102,500, mainly in credit card debt .

Kraft is a former reporter for WFLD-TV who joined the Quinn administration as a budget office spokeswoman in 2009. She was later promoted to assistant budget director before being named Quinn’s top spokeswoman in July with an annual salary of $111,000, the Tribune reported.

“That board and that staff is the thin blue line protecting the taxpayers of the city of Chicago from paying, in case there’s something’s mismanaged,” Emanuel told WBBM-AM. “And I think we should find the best-qualified people for that, which is why I – given the board I inherited – replaced them, put in place a whole new board with backgrounds in financial management, and expect the staff to meet that standard.”

“I think we have a good person, a strong person, a strong woman who knows how to manage the budget, find economies and efficiencies, knows how to work with people,” Quinn told WBBM. “There’s a lot to be said with someone who can work with all kinds of folks, make sure we have diversity and fairness, and also a person who understands the world of finance and bonds and things like that, and I think that’s Kelly Kraft. … I think it’s time for the mayor to recognize that.”

Tribune columnist Eric Zorn correctly asked with the title of an October 10 blog post, “When, if ever, is personal bankruptcy a disqualifying entry on a job application?” As we have noted before in our blog posts about famous bankruptcies , many notable modern and historical figures also had to file bankruptcy before they became successful. The truth is that Chapter 7 and Chapter 13 bankruptcy are legal ways for people to reorganize debt when life delivers unexpected changes. Contact our firm at (866) 930-7482 or complete the form on this page to have our Chicago bankruptcy lawyers see if Chapter 7 or Chapter 13 bankruptcy might be able to help you turn your own situation around.

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Dr. Chris DeRitis, a consumer credit expert at the economic research and consulting firm Moody’s Analytics, told the Times-Tribune of Scranton, Pennsylvania, that all debt collection is under the microscope. “A lot of this debt gets traded three, four or five times,” Dr. DeRitis told the Times-Tribune for the story published on October 21, 2012. “It’s a messy business.”

The Times-Tribune noted that many collection agencies that buy debt do not have all the documentation to support the original agreement, meaning many companies are filing debt-related lawsuits with “insufficient records, faulty documents and questionable claims.”

“Some companies are doing this more responsibly than others,” Dr. DeRitis told the Times-Tribune. “There are cases of fraud where unscrupulous debt collectors put charges on people’s accounts.”

Allegheny County Judge R. Stanton Wettick, who has presided over “hundreds of cases in which banks sold delinquent credit card accounts to debt buyers who filed litigation to recover the money,” told the Times-Tribune that sometimes the affidavits do not appear to be signed by the right people. The story noted that debt collectors frequently prevail in court because many defendants in credit card suits never contest the action. “If 100 get filed, 75 turn into default judgments,” Judge Wettick told the Times-Tribune.

However, the Times-Tribune also pointed out that because default judgments enable debt collectors to freeze a consumer’s bank account or garnish wages to recover obligations, more consumers are now challenging the evidence. “For a lot of companies now, if someone shows up and contests it, it may not be worth their while to pursue it,” Judge Wettick told the Times-Tribune.

If you are being harassed by debt collectors about your credit card debt , filing Chapter 7 or Chapter 13 bankruptcy will end those phone calls. You may be able erase your credit card bills and other unsecured debt by filing Chapter 7 bankruptcy , or you could pay back a fraction of what you owe through a Chapter 13 plan. Contact our firm at (866) 930-7482 or complete the form on this page to have our Chicago bankruptcy lawyers determine which plan would work best for you.

Benjamin Brand Services – Chicago bankruptcy attorneys

On Monday, we discussed the increase in seasonal work this year that could help a lot of families in the Chicagoland area during the holidays. While that additional income could make a real difference, this 2011 video from WNXV-TV addresses another issue that can cause problems during Christmas shopping: layaway plans.

Chicago Tribune consumer news reporter Gregory Karp noted in a column published on October 12, 2012, that on its face, layaway “seems harmless enough.” However, Karp said layaway is “illogical” and wrote, “Almost nobody should use it for holiday gift purchases this year.”

While many fans and proponents of layaway claim that such programs allow consumers to save on the interest they would incur by using a credit card, Karp called that a “straw-man argument.”

“Credit cards are not the alternative to using layaway,” Karp wrote. “Paying cash is.”

Karp also noted the statement of New York’s US Senator, Charles Schumer, who demanded last year that retailers display the true cost of layaway fees in credit card terms. Schumer said a $100 purchase with layaway fees can have the same effective interest rate as a credit card charging 81 percent annually.

“These layaway programs are nothing more than hideaways for sky-high interest rates that consumers would never tolerate with a credit card,” Schumer said in a news release last year. “The holiday season is supposed to be about giving and not taking, but these layaway programs are taking advantage of people and charging them outrageous interest rates, under the guise of making it easier and more affordable to shop.”

Karp also addressed issues with initiation and cancellation fees that can create additional headaches. As thousands of families all over Illinois prepare for the holiday shopping season, we encourage you to read the fine print of any layaway agreement you might be considering. And if foreclosure or credit card debt is already creating problems, you could gain some peace of mind by filing Chapter 7 or Chapter 13 bankruptcy before the end of the year. Timing could be a critical element to successfully filing Chapter 7 or Chapter 13, so it is in your best interest to take action today. Contact our firm now at (866) 930-7482 or fill out the form on this page to see let our Chicago bankruptcy lawyers see how we can help.

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Holiday shopping will be here before you know it, which could make some new tools on one website particularly helpful for thousands of families. The New York Times reported on October 1, 2012, that the website CardHub.com introduced calculators that help consumers decide the best option for paying down their credit card debt .

The website features a “credit card payoff calculator” that lets you enter the amount of debt you aim to pay off, the card’s regular interest rate (plus any introductory rates) and the length of time over which you would like to pay off the debt. The Times reported that the calculator not only tells you how much you will need to pay each month, but how much you will pay in interest as well.

According to the Times, the tool also recommends other credit cards that could have more favorable terms than your current card. CardHub Chief Executive Odysseas Papadimitriou told the Times that “it might make sense to seek the best deal you can get and pay off your debt in the most cost-effective way,” but cautioned against applying for a new card just save on interest if you expect to apply for significant credit in the near future, such as a mortgage.

The tool can also be beneficial if you plan to incur some debt and simply want to evaluate the best way to pay it off. According to the Times, “two other versions of the tool let you compare different credit cards, and another takes into account any balance-transfer fees you might pay.”

Are you overwhelmed with credit card debt? You should know that you may able to discharge your unsecured debt by filing Chapter 7 bankruptcy , or you could end up paying back a fraction of what you owe through a Chapter 13 repayment plan. If you wanted to see whether you qualify for Chapter 7 or Chapter 13 , contact our firm now at (866) 930-7482 or use the form on this page to have our Chicago bankruptcy lawyers review your case.

Benjamin Brand Services – Chicago bankruptcy attorneys

The Associated Press reported on October 1, 2012, that American Express has agreed to pay $112.5 million in refunds and fines after a multiagency investigation of the company revealed the company “charged unlawful late fees and deceived customers to pressure them to pay off old debts or buy extra credit card services.” In addition to $27.5 million in civil fines, American Express will refund $85 million to about 250,000 customers.

The settlements were announced by four federal agencies, including the Consumer Financial Protection Bureau (CFPB), the Federal Reserve, the Office of the Comptroller of the Currency and the Utah Department of Financial Institutions.  The AP reported that the agencies said American Express violated federal laws prohibiting deceptive practices by using false statements to get customers to settle old debts, including falsely telling customers that remaining balances would be forgiven if they agreed to settlements to partially pay off their debts.

CFPB Director Richard Cordray said in a statement that American Express violated consumer protection laws “at all stages of the game – from the moment a consumer shopped for a card to the moment the consumer got a phone call about long overdue debt,” according to the AP. The company charged late fees on some credit cards based on a percentage of the debt owed, unlawfully discriminated against consumers applying for new card accounts on the basis of age and failed to report customer disputes over billing to the consumer credit reporting agencies.

This news will certainly be welcome for the many victims of American Express’ unethical practices. If you are currently dealing with calls from creditors and struggling to make monthly payments, you can get relief from substantial credit card debt by filing Chapter 7 or Chapter 13 bankruptcy . You may be able discharge your unsecured debt in Chapter 7 , or you could pay back a fraction of what you owe through a Chapter 13 repayment plan. To see how our Chicago bankruptcy lawyers can help, fill out the form on this page or contact our firm today at (866) 930-7482.

Benjamin Brand Services – Chicago bankruptcy lawyers

This CBS News video discusses the increasing number of Americans that are struggling with student loan debt. The Chicago Tribune reported on September 27, 2012, that a Pew Research Center analysis of government data found nearly one in five of households are burdened by school loans. According to the Tribune, the 19 percent of households affected by school loan debt in 2010 is more than double the share from two decades ago, when 9 percent of households in 1989 owed money for education.

Furthermore, the Tribune also noted that student loan payments are equal to nearly a quarter of the income for individuals with incomes in the lowest fifth nationwide. The Tribune reported that young people and poorer Americans are especially hard hit, as four in 10 households headed by someone younger than age 35 have student loan debt. Overall, the Tribune said student loans now make up 5 percent of all debts, whereas they comprised 3 percent just five years ago.

Barring an extreme hardship, student loan debt is very rarely discharged when an individual files Chapter 7 or Chapter 13 bankruptcy. However, filing Chapter 7 or Chapter 13 bankruptcy could allow you to discharge other certain debts, such as credit card or medical bills. Freeing up this additional income could not only help you make your student loan payments, but it may also help you pay off the education balance sooner. Contact our firm at (866) 930-7482 or complete the form on this page to let our Chicago bankruptcy lawyers see how we can help.

Benjamin Brand Services – Chicago bankruptcy attorneys

On Monday, we noted some encouraging stories indicating that Americans were cutting back on borrowing, credit card debt was declining and the Consumer Financial Protection Bureau (CFPB) was putting more institutions on notice about deceptively marketed products. However, a Wall Street Journal story published on September 5, 2012, called attention to another type of plastic that is starting to become a growing problem: prepaid cards.

Noting that these “cards were designed to help the less-affluent have better control their finances by allowing them to spend only the preloaded amount,” the Journal reported that some consumers are now accumulating debt because of overdraft and other credit-like features have been added to the cards in recent years. Furthermore, the Journal also stated that prepaid cards are “among the fastest-growing types of plastic,” as American consumers loaded $83.3 billion onto prepaid cards in 2011. Payment-industry researcher Mercator Advisory Group said this was a 34 percent increase over the prior year, according to the Journal.

The National Consumer Law Center, the Center for Responsible Lending and the Consumer Federation of America are now lobbying the CFPB to prohibit prepaid cards from offering any type of credit. The Journal reported the agency is “evaluating the consumer advocates’ proposal as part of a broader effort to more-closely regulate prepaid cards.”

The Journal story began by citing an Ohio man who borrowed $400 and loaded it onto a prepaid card, beginning a cycle of debt that would ultimately result in $1,344 of total fees from the card provider by the time the man stopped borrowing a year later. “Prepaid cards were designed to be a safety net,” Steve Streit, chief executive of prepaid card issuer Green Dot Corp., told the Journal. “Once you start adding overdraft and other types of credit, it becomes a form of debt.”

Does this situation sound similar to your own? You should know that you may be able to wipe out your credit card debt by filing Chapter 7 or pay back a portion of the debt through a Chapter 13 bankruptcy plan. Our Chicago bankruptcy lawyers can help determine which plan you are eligible for when you fill out the form on this page or contact our firm at (866) 930-7482.

Benjamin Brand Services – Chicago bankruptcy attorneys

July as consumer debt declined, even as Americans boosted their spending by the most in five months. The Post said it was the first time that Americans cut back on borrowing in nearly a year, adding that the drop in credit card debt offsets “a small rise in a measure of auto and student loans.”

This came less than a week after the Detroit Free Press said that more credit card holders and consumer groups could also be saying good riddance to very costly add-on products, such as so-called “credit-protection plans.” This is because the Consumer Financial Protection Bureau (CFPB) is putting multiple institutions on notice about misleading debt-protection products and consumer insurance. These plans are under fire from the CFPB for deceptive marketing practices, and the Free Press reported that one settlement with regulators resulted in Capital One Bank refunding about $150 million to 2.5 million customers as well as paying $60 million in penalties.

While these are all encouraging developments that can hopefully help more individuals avoid the burden of credit card debt, there are still other concerns that we will discuss in our next blog post. Are you currently overwhelmed with credit card bills? You should know that filing Chapter 7 or Chapter 13 bankruptcy can end calls from debt collectors and may be able to give you a fresh start by wiping out the credit card debt or allowing you to only pay back a fraction of what you owe. Fill out the form located on this page or contact our firm at (866) 930-7482 to see what our Chicago bankruptcy lawyers can do for you.

Benjamin Brand Services – Chicago bankruptcy lawyers

While we often write about the problems that the bigger payments like mortgages, medical bills and student loans cause for families throughout the Chicagoland area; however, the truth is that the increase in the smaller everyday bills can be just as devastating. In a September 3, 2012, column for CNN, author and Newsweek editor David Frum predicted that 2013 will be a year of serious global crisis.

As Frum noted and many families across Illinois have felt, an intense summer drought has ruined key crops. The corn harvest will drop to its lowest level since 1995, and Frum noted that corn and wheat prices increased about 25 percent each while soybean prices climbed roughly 17 percent. This will lead to all sorts of higher food prices, ranging from meat and poultry to dairy products.

The Tennessean reported that a gallon of milk “will cost 10 cents to 15 cents more by Thanksgiving and rise an additional 25 cents by year-end.” Last month, the PBS NewsHour reported in the video above that a price index from the US Agriculture Department showed that “overall food prices would increase about 3 percent to 4 percent because of the drought,” with the corn intensive items like beef, pork, poultry and eggs most likely to be impacted.

While Frum wrote that higher food prices are “in almost all cases, a manageable burden,” how much will each additional dollar every week affect you and your family? If you have been scraping by every month and are in need of debt relief in order to keep up with the cost of living, then Chapter 7 or Chapter 13 bankruptcy may be the answer you need. Filing bankruptcy delays foreclosures and ends the calls from debt collectors.

Our firm can pull you out of what seems like a crisis or we can help you avoid what could turn into one. If you are tired of fearing what financial obstacle might come up next, contact our firm today at (866) 930-7482 or use the form on this page to let our Chicago bankruptcy lawyers see how we can help eliminate as many of those obstacles as we can.

Benjamin Brand Services – Chicago bankruptcy attorneys