Separating Fact From Fiction: Common Myths About Credit Card Debt Relief In Overland Park, Kansas

What you will learn in this guide:

• The impacts of debt settlement on your credit score.
• If debt relief guarantees that you will not face wage garnishment.
• Whether paying the minimum balance will hurt you in the long run.

Is It True That Debt Settlement Will Always Negatively Impact My Credit Score?

Your credit score is a lifeline to your lifestyle, and you should be aware of anything and everything that can affect it. Unfortunately, debt settlement generally negatively affects your credit score because creditors report settled debts as “settled” rather than “paid in full,” indicating that the borrower did not fully meet the terms of the original agreement.

However, the impact can vary depending on your prior payment history and other credit factors. The damage may lessen over time, especially if you maintain good financial habits.

Can Creditors Still Sue Me After Negotiating A Debt Settlement In Kansas?

Handling creditors can be the most daunting experience. The unrelenting calls and constant threats of legal action can take a toll on your mental and emotional state. Anything you can do to give yourself a breather can go a long way in helping you strategize how to face the debt.

Creditors cannot sue you after negotiating a debt settlement. Once a debt settlement agreement is reached and paid in full, creditors cannot sue you for that specific debt. However, it is crucial to get the settlement terms in writing, as failure to follow the agreement or settle properly can lead to legal action. Additionally, other creditors not part of the agreement can still pursue lawsuits for separate debts.

Is It A Myth That Debt Relief Guarantees I Won’t Face Wage Garnishment?

Sadly, this is another myth. Debt relief programs, including settlement or consolidation, do not inherently stop wage garnishment unless an agreement is reached with creditors or a court orders the garnishment to stop. In Kansas, creditors who have already obtained a judgment can continue garnishment unless it is explicitly addressed.

Can Credit Card Debt Relief Stop All Collection Calls?

Debt relief itself does not automatically stop collection calls. However, once you enroll in a debt settlement or relief program, you can notify creditors to direct communications to the settlement company. Additionally, under the Fair Debt Collection Practices Act (FDCPA), you can send a written request to collection agencies to cease contacting you, which applies in Johnson County and nationwide.

Attorney Rob Titus is a seasoned lawyer based in Kansas who has helped countless clients like you navigate the intricacies of real estate law. With over 10 years of experience, he is prepared to assist you with conveyancing, land searches, and other real property issues, including lifting liens and preparing transfer documents.

Still have questions? Ready to get started? Contact Titus Law Firm today to schedule an initial consultation.

Is It A Myth That Only Paying The Minimum Balance Will Hurt Me In The Long Run?

No, this is not a myth. Paying only the minimum balance can lead to higher interest payments and prolonged debt repayment, as a significant portion of each payment typically goes toward interest rather than the principal balance. Over time, this can cost more and potentially damage your credit if you struggle to manage accumulating debt.

What Are Some Of The Biggest Myths Clients Believe About Credit Card Debt Relief, And How Do You Help Them Understand The Reality Of Their Options?

Common myths include:

• “Debt relief erases all debts.” Reality: Debt relief may reduce or consolidate debt but rarely eliminates it entirely.
• “Debt settlement is better than bankruptcy.” Reality: This depends on individual circumstances, as bankruptcy can offer a fresh start for some.
• “Debt relief is quick and easy.” Reality: It often requires time, patience, and disciplined financial management.

To help you, we provide clear explanations of how debt relief works, including its benefits and limitations. We’ll also be sure to discuss all available options, such as budgeting, debt management, settlement, or bankruptcy. Finally, we’ll set realistic expectations and create a plan tailored to your financial situation.

Can You Share A Case Where A Client Was Misled By Debt Relief Myths, And How You Guided Them Toward A Better Financial Path?

A client believed a debt settlement company’s promise that they could eliminate all debts without any legal risks. They stopped making payments, resulting in lawsuits and wage garnishment.

We reviewed the client’s financial situation and explained that no program guarantees complete debt elimination or protection from lawsuits. We also negotiated settlements with creditors to halt legal actions and garnishments. Next, the client and I developed a budget and referred the client to a credit counselor for long-term financial management.

Finally, we educated the client on warning signs of debt relief scams to avoid similar issues in the future. This approach helped them regain financial control and taught them the skills needed to avoid further pitfalls associated with misleading promises.

Still Have Questions? Ready To Get Started?

For more information on Separating Fact From Fiction, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (913) 543-4500 today.