Reduce your debt!! ... I'm curious.

[petrw1]

I am from Canada and have had a satellite radio for almost a year now. In the last few months there have been a lot of ads from more and more companies telling consumers they have a "legal right to reduce their debt" and if you call their number they may be able to reduce your debt by more than half.

I am assuming this is primarily in the U.S.A. Can someone give me a brief explanation in layman's terms what this is all about? I understand that Credit companies would rather get "some" money than lose it all to the person going bankrupt but is there more to it than this?

[Mini-Geek]

(I live in the US but am in no way a professional on this subject or extremely knowledgeable about it)
As I understand it, they basically tell the credit card companies that the person won't be able to pay their debt off and that the person will pay a portion instead of none at all. AFAIK there's not much more to it than this.

[joblack]

Originally Posted by Mini-Geek

(I live in the US but am in no way a professional on this subject or extremely knowledgeable about it)
As I understand it, they basically tell the credit card companies that the person won't be able to pay their debt off and that the person will pay a portion instead of none at all. AFAIK there's not much more to it than this.

There are some legal things. They say by simply sending you the credit card there is no legal contract and so you don´t have to pay this.

Anyway - our money system creates new money by creating a new credit so on a global economic scale it isn´t possible to reduce the debt.

If the debt would be reduced to zero all the investors wouldn´t have new investments and the economy would plunge into a depression.

[cheesehead]

Originally Posted by joblack

There are some legal things. They say by simply sending you the credit card there is no legal contract and so you don´t have to pay this.

Who is "they"?

Every credit card I've seen was accompanied by a contract that included a provision saying something like, "any use of this card implies acceptance of this contract". So ... it's true that "by simply sending you the credit card there is no legal contract", but ... as soon as you use that card, there is a legal contract that you have accepted and agreed-to!

Thus the statement that "you don´t have to pay this" (if "this" refers to ones credit card account balance resulting from ones own use of the credit card) is false. If some credit-repair agency tells you that, they're lying (since such an agency must know better, it's deliberate deception).

It's true that if you receive a credit card, do _not_ use it, and someone else subsequently, say, fishes it out of your trash and uses it, then you have no legal obligation to pay the resulting debt ... because you did not agree to or accept the contract by the act of using the card yourself.

Anyway - our money system creates new money by creating a new credit so on a global economic scale it isn´t possible to reduce the debt.

If the debt would be reduced to zero all the investors wouldn´t have new investments and the economy would plunge into a depression.

... but none of that global stuff is relevant to the case of a particular person's credit card debt. What applies there is the contract between that person and the card-issuing company.

[joblack]

Originally Posted by cheesehead

Who is "they"?

Every credit card I've seen was accompanied by a contract that included a provision saying something like, "any use of this card implies acceptance of this contract". So ... it's true that "by simply sending you the credit card there is no legal contract", but ... as soon as you use that card, there is a legal contract that you have accepted and agreed-to!

Originally Posted by cheesehead

... but none of that global stuff is relevant to the case of a particular person's credit card debt. What applies there is the contract between that person and the card-issuing company.

Thats my understanding, too.

I´m not a layer and I have never checked that further (I have seen some pretty interesting presentations on youtube).

As far as I know in the USA the income tax isn't legal as well (source: America - From Freedom to Fascism - http://video.google.com/videoplay?do...80303867390173 ) but the government gets it anyway.

[joblack]

Originally Posted by cheesehead

... but none of that global stuff is relevant to the case of a particular person's credit card debt. What applies there is the contract between that person and the card-issuing company.

Yes for a business it isn´t relevant. But on a country scale or even worldwide most of the monetary systems have to expand because of the interest system (exponential growth).

Where would the ultra rich clique put there millions interest profits if there wouldn´t be a lot of idiots who increase their credit limit even further?

[schickel]

Originally Posted by petrw1

I am from Canada and have had a satellite radio for almost a year now. In the last few months there have been a lot of ads from more and more companies telling consumers they have a "legal right to reduce their debt" and if you call their number they may be able to reduce your debt by more than half.

I am assuming this is primarily in the U.S.A. Can someone give me a brief explanation in layman's terms what this is all about? I understand that Credit companies would rather get "some" money than lose it all to the person going bankrupt but is there more to it than this?

There are actually several different types of "debt reduction"/"credit repair" available.

The ones that run ads like you hear are probably the type that counsel you by advising to you stop paying on all of your debt in a bid to get your creditors to bargain away some of the debt in exchange for resuming payment. Downside: destroys your credit rating (negative information stays for 7 years); no guarantee of debt reduction from creditors; "counseling" agencies get a fee from you up front.

Another type out there is the "instant credit repair" people. The credit reporting agencies have really cracked down on this. Basically, people with great credit scores are paid fees to allow people with bad credit to "piggyback" on their credit reports (obtaining a credit card with a low limit using the great credit score person as a "sort of" co-signer.) Downside: credit agencies caught on to this and want to outlaw it; person with great score runs a risk of getting their score lowered; agencies want a fee up front.

The last segment out there are the non-profit consumer credit couseling organizations. CCCS affiliates provide couseling services to help people in over their heads learn to budget and work on setting up a repayment schedule, and trying to get the interest frozen on current accounts so the balances don't become any larger. This has been made mandatory before you can file for bankruptcy. Downsides: no "instant repair" of your credit score; your credit limits are frozen where they are currently (no more big screen TV...) Upside: no up front fees, you pay as you go; for people that care, a clear conscience wrt to paying their debts.

[cheesehead]

Originally Posted by joblack

As far as I know in the USA the income tax isn't legal as well

Reality check: Do you actually think that if the income tax weren't legal, it would still be enforced this many decades after it was instituted?

How many tax-protesters/nonpayers who actually argued in court that the income tax was illegal do you want to interview in their federal prison visiting rooms? (See below for Sherry Peel Jackson)

The Internet allows people to broadcast to the world any old unfounded idea they have, whereas they used to be limited to having pamphlets printed up and handed out to folks passing by.

For more reality, see http://www.keytlaw.com/irs/taxarguments.htm

The IRS responds in depth to some of the more common frivolous “legal arguments” made by individuals and groups who oppose compliance with the federal tax laws. The first section groups these arguments under six general categories, with variations within each category. Each contention is briefly explained, followed by a discussion of the legal authority that rejects the contention. The second section responds to some of the more common frivolous arguments made in collection due process cases brought pursuant to sections 6320 or 6330. These arguments are grouped under ten general categories and contain a brief description of each contention followed by a discussion of the correct legal authority. A final section explains the penalties that the courts may impose on those who pursue tax cases on frivolous grounds. It should be noted that the cases cited as relevant legal authority are illustrative and are not intended to provide an all-inclusive list relating to frivolous tax arguments

< followed by detailed legal replies to a number of contentions about the federal income tax >

... or "The Tax Protester FAQ" at http://evans-legal.com/dan/tpfaq.html

Originally Posted by joblack

(source: America - From Freedom to Fascism - http://video.google.com/videoplay?do...80303867390173 )

Reply from http://answers.yahoo.com/question/in...6084856AA4vfoo (Edit: that page now says the question has been deleted (?!). However, the link to evans-legal.com does work.)

"You can ignore Internet conspiracy theory videos like "America: Freedom to Fascism" and "Zeitgeist". They are full of inaccuracies, erroneous information, and out-of-context quotes. Go to http://evans-legal.com/dan/tpfaq.html and look up almost all income tax related arguments brought forth in those films and see that they are wrong. BTW, Sherry Peel Jackson, one of the people interviewed in Freedom to Fascism was recently CONVICTED of failing to file income tax returns. The trial lasted two days and the jury only needed 45 minutes to convict her on all counts. The stuff on the Federal Reserve in both of those films is also wrong."

- - -

Originally Posted by joblack

Yes for a business it isn´t relevant. But on a country scale or even worldwide most of the monetary systems have to expand because of the interest system (exponential growth).

From the OP [my emphasis]:

"... companies telling consumers ...

... Credit companies would rather get "some" money ... [from] the person going bankrupt ..."

[cheesehead]

Originally Posted by cheesehead

For more reality, see http://www.keytlaw.com/irs/taxarguments.htm:

Unfortunately, I failed to notice in time that this forum's software had included the trailing colon in two URL links above. That one should have been:

http://www.keytlaw.com/irs/taxarguments.htm

and another one

http://answers.yahoo.com/question/in...084856AA4vfoo:

should have been:

http://answers.yahoo.com/question/in...6084856AA4vfoo

[ewmayer]

The other legal means [which I haven't yet seen mentioned here] for "reducing one`s debt" - more accurately of reducing the cost of servicing one's debt - is to consolidate various high-interest-rate balances under the umbrella of a single lower-interest-rate form of debt, whether it be credit-card-based or other.

Many of the "credit repair" and other too-good-to-be-true-sounding schemes in this area are flat-out scams. But can you really blame people for falling prey to these, when they see Wall Street CEOs and sundry crooks from the world of big business getting *their* debt reduced "for free" (i.e. at taxpayer expense)? It's a corrosive mentality which has permeated every level of society and which our government is busily helping to foster. The irony that this spate of "socialism for the rich and connected", the largest example of its kind in history, was a direct result of decades of Reagan-Republican-style "deregulated free market" economics is just so rich. But that is for any one of several other threads.

But the upshot of this Bailout Nation mentality for the big players is: The best way to "Get out of debt free!" is to accumulate so much of it in such a reckless fashion than the alternative to your getting bailed out becomes unpalatable to the Powers That Be. If you're gonna leverage up, do it right and proper, I say, and that means do it big.

[Batalov]

It took me a few years to shed any doubt that people are the same in the countries on both sides of the curtain. If it is any consolation, now that U.S.of A. mentality turned close to communistic ("I was misled by vultures, so I deserve to keep my grab and everyone else must help me, bail me, bail me, reduce my debt!" ~= "From each according to ability, to each according to his needs"), the ex-U.S.S.R. spiraled beyond capitalism into complete lawlessness (because common people stopped thinking for 70 years and now they have no idea how to count money on any level, this muscle is atrophied there). This see-saw will bounce for a while, I guess... Wild West in Russia, socialism in America, and back... I am exaggerating, of course, for simplicity.