Contract Lifecycle Management

If you have lived long enough and took the time to pay close attention you may notice that trends tend to come in cycles. What’s cool now will be cool again 10 years from now. Just take a look at all of the new fashions people are wearing nowadays. You may recognize a few of them from your own youth, or the youth of your parents. This is the natural order of things. Men and women become crazed with something until it eventually burns itself out, but once sufficient time has passed someone chooses to bring back those old trends to go for one more round on a fresh number of faces.

This procedure of cycles does not limit itself to just fashion. It may also be noticed in other facets such as debt relief. To comprehend this, you need to comprehend the various forms of credit card debt relief. The oldest of these forms is Bankruptcy. This was developed as a way for individuals who fell on tough times to prevent being shot, hung or sent to debtors’ prison. As time went on however men and women realized that this became an instrument that might be utilized and taken advantage of. Folks would intentionally overextend themselves and once they arrived at their max capacity, they would seek bankruptcy relief and get all of it wiped away.

For many years banks lobbied to get this changed. About 1995 the bankruptcy abuse act was created. This put tougher regulations on who could and could not qualify for a chapter 7 bankruptcy. It put a larger focus on a chapter 13 bankruptcy, which is actually a repayment program where men and women could wind up paying 80 % or a lot more back to the creditors.

To offset the deficits they were seeing because of the rise in bankruptcies, banks started to boost interest levels. After some time the interest rate caps raised to as much as 30 % or more. This put lots of people who were still paying the money they owe either on a perpetual cycle of paying minimum payments and getting nowhere fast, or on the verge of falling behind. From this the consumer credit counseling program came into being. In many cases these agencies were run, or at least backed by the finance institutions themselves. What this permitted individuals to do is to stop making use of their cards and put them into this program. The company would attempt to lower all of the interest rates then you’d make one monthly payment to the agency who would distribute that out to the creditors monthly.

The good part about this program is that you were capable of paying down the debt in 5 to 6 years. This is clearly much better than taking 30 or more years. But, the downside was that the payment you had been making was generally the same as your minimum payments in the first place, so in the event you were in a situation where you had been about to fall behind, then this would not prevent this.

Once again with most things, people became greedy and as increasingly more folks decided to ring up their cards then enter them into a CCCS program hoping for zero percent interest for good, the credit card companies changed several of their procedures. Many of them did away with 0 % interest rates or limited them to a single year. In addition they began to reevaluate individuals after six months to a year, to find out if they still qualified for the program.

Next came the debt consolidation loan boom. As property values began to rise, mortgage brokers found a growing number of people with equity within their homes that could be accessed. Thus began the home loan boom. A large amount of people started to make use of their homes equity and consolidate their debt into one reduced monthly payment. But again greed began to dominate. As the pool of possible individuals who qualified for traditional loans dwindled, the industry started to develop new ARM loans for individuals who wouldn’t have normally had the capacity to receive a loan. This was the beginning of the housing crash. Just like any bubble, if you keep on inflating and blowing it up ultimately, it’s likely to pop. And this is what happened. As these adjustable rate loans started to alter, several of them tripled the interest rates making the home owner to go delinquent and in many cases lose their homes.

As you might know there are always likely to be those people who will benefit from individuals who are in dire straits. We commonly call these folks “snake oil salesmen” coined in the early years when folks would sell fake potions to remedy everything from thinning hair to rheumatoid arthritis. These get wealthy fast type of people would sell this tonic to men and women eager for a remedy. Quite often quite quickly, folks would realize that this was a scam, but not before many individuals would have become victim to them. If the salesperson wasn’t hanged, he would lay low, going from town to town until men and women forgot about him and the fact he was a sham, then he would pop his head up once again selling his snake oil to individuals who did not know it was a scam.

Just as these snake oil salesmen, you’ll find folks in the credit card debt relief programs industry that attempt to take advantage of individuals in desperate situations. One kind of this get wealthy scam is what’s referred to as debt elimination. The idea of this is that you hire an attorney who will try to sue the credit card companies saying that the debt is not valid. They try to use old loopholes within the law saying that it is unlawful how they calculate interest rates, or forcing them to “prove” that is is your debt. Regardless of what these folks tell you, ask yourself this one question. Did you charge the debt? Did you benefit from using the credit card by making purchases for items which you owned? Unless somebody stole your card and made purchases you didn’t know about, or the bank added charges to your bill that belongs to another person, in nearly all situations the answer to that question is going to be yes. That being stated, you are likely to be challenged to convince a judge that the debt isn’t yours and that you do not owe it.

The last form of debt consolidation programs is debt negotiations. There are essentially two varieties of debt negotiations. The first is known as Debt resolution. This is when you hire a law firm to negotiate with your credit card companies, for you, in an attempt to get them to agree to accept less than your full balances. The major issue with this form of debt relief, it that in many situations the debt settlement law firm will charge a retainer along with a monthly legal fee upfront before any settlements have been achieved. This is generally on top of their settlement fees. Though it may well appear reasonable to pay an attorney to legally represent you, what a lot of people don’t understand is that the lawyer won’t represent you in court. Actually, many of them will not even assist with answering the lawsuit. All they are representing you for is to negotiate the debt and that’s it. So essentially you’re paying them extra to do totally nothing.

The second type of debt negation is known as debt settlement. As with the above example, this is where the debt is negotiated for much less than what you presently owe by a qualified debt settlement company with a confirmed track record.  Just as with the lawyers you’ll find those debt settlement companies which will attempt to take fees upfront. Be careful, this goes against existing regulations. Any reliable settlement company will never charge you for their services before debt has been settled.

It actually doesn’t matter what type of debt relief you choose to go with, ultimately you need to be well informed. A reputable company will do everything they are able to to make sure you know all of your choices and have a clear understanding of all of them.  They will not attempt to push you into anything and will go into great detail when reviewing your case. If you’re seeking debt settlement do your research and make sure you’re dealing with a company that’s willing to follow the regulations, not charge you any fees until a settlement has been reached, and who will make sure that the choice they supply is genuinely the very best option for you.