Cover Your Own Bare One

If you’re a small business owner, like me. Chances are, you deal with contract issues on a daily basis. In one form or another, contracts bombard us. Most of them are easy enough to understand, basic quid pro quo. But what you need to know about contracts and what legal remedies each party might have for each one entered into, might just be more than you have the time and the inclination to deal with.

Don’t enter into a legally binding contract of any type without knowing exactly what you’re getting into and exactly what your duties and rights are. I’m going to say it, cringe. Get a lawyer.

A contract can be defined as a promise or set of promises for which the law gives a remedy, or the performance of which the law, in some way, recognizes as a duty. Therefore, by establishing a mutual agreement, the parties to a contract create enforceable duties or obligations that are legally binding. Obviously, in most instances, it is preferable to establish written contractual relationships. However, written contractual instruments that are ambiguous or poorly drafted, can create more problems than they solve. Written contracts should always be drafted in a clear, concise and understandable fashion.

Notice the words clear and concise. I haven’t seen one of those recently. How about you? Obviouly there are lots of law firms, many of them don’t even touch contract law. So, do your due diligence and find one that does. These guys are like pediatricians, they specialize. The key, for me anyway, is finding a firm that excels in dealing in not only contract law, but mergers and acquisitions and living trusts as well. And one, who has license to practice (is admitted to the bar or has reciprocity) in Mississippi.

The One Way To Lose Your Debt

I’ve said it before and I’m going to say it again. If debt to income ratio is so high that you are only making minimum payments on your credit cards and still have month left at the end of the paycheck, simply making a budget isn’t going to help you. you need is basic credit education. You need a professional who understands how to get you out of debt and more importantly, how you got that deep into debt.   You need a debt professional who’s going to hold your hand, take you through the process, and be there on the other side to help you rebuild your credit. Don’t try to do this on your own. Creditors generally will not deal with individuals. You’ll end up frustrated, confused and in a worse spot than you’re already in.

There are four alternatives to solving debt problems, and while I believe that a “Debt Negotiation Program” is the best solution for most consumers, I want to educate each and every person strggling with debt on the alternatives and let them make the choice that is best for their solution.

• Credit Counseling
• Debt Consolidation
• Bankruptcy
• Credit Card Monthly Payment

Credit Counseling

The main problem with Consumer Credit Counseling organizations is that they are secretly working for your creditors! This may seem unbelievable, but it is true - and it is why you end up paying about three times more money to pay off your debts in Credit Counseling than in a “Debt Negotiation Program.” Most Consumer Credit Counseling firm’s claim non-profit status and pretend to be independent. But in fact, these non-profits are funded and supported by the very people you owe money to; the credit card companies. That is why Consumer Credit Counseling companies do not negotiate your debts down. They merely try to come up with a plan to make sure you keep paying your credit card bills every single month. They want to force consumers to pay as much money as possible to your creditors. Sure, they may help lower your interest rate a few points, or eliminate a late payment or two, but the credit card companies are happy to do this when they know you are going to keep making payments that a debt arbitrator could have negotiated away for pennies on the dollar. Additionally, since you are repaying 100% of your debt balance plus interest charges (even after they are reduced by Consumer Credit Counseling), you could be in a Consumer Credit Counseling program for 5 years!

Compare that to 2-3 years in a debt settlement program. In a “Debt Settlement Program” you can be out of debt twice as fast and for about 1/3rd of what you’d be paying in a Credit Counseling.

Debt Negotiation Program

Why not become debt free as soon as possible, as opposed to being stuck in a consumer credit counseling program for several more years. Once you learn about the alternatives, the decision becomes easy to choose a Debt Settlement Program. Furthermore, most Consumer Credit Counseling companies require you to make all of your payments to them and then they pay off your creditors. Recently, a state Attorney General sued one of the largest Consumer Credit Counseling firms because they were not actually passing on all the money they get to the credit card companies, they were keeping it themselves! In fact, the IRS has recently stopped granting non-profit status to credit counseling firms. Debt Settlement firms receive no payments from your creditors, so their incentives are aligned with yours. They make money when you save money and the only money you send them is for their fees, if and only if they save you money.

Debt Consolidation

Unfortunately, a Debt Consolidation Loan is one of the most common solutions people think of when they fall into financial difficulties. This is a problem because most people who get a debt consolidation loan find themselves in much deeper financial trouble than they were in to begin with. Debt consolidation loans transfer debt from one place to another. While this may sound good, since many times it can be appear to lower your monthly payments, a debt consolidation loan will not reduce the amount you owe. We have yet to find someone who has solved their debt problems by borrowing more money through debt consolidation. You will still pay back 100% of the debt consolidation loan, plus interest. The interest rate is sometimes lower than before, but this is because debt consolidation loans are usually secured loans that cannot be lowered or negotiated. Once you sign up for a debt consolidation loan, you have just gone from an unsecured debt to a secured debt and have put your personal assets (e.g. your car or home) at risk. At that point if you can’t pay your bills your creditors can come and take your personal property - thus creating a bigger problem than you had to begin with. I think the best solution is to deal with financial problems through Debt Negotiation, not debt consolidation. This way you are dealing directly with the problem, not temporarily avoiding debt problems.

Bankruptcy

Bankruptcy is a way to potentially get out of your debts. Unfortunately, it leaves a long lasting scar, and comes at a high price - financially, emotionally, and socially. It is a long and painful process and the repercussions can last for over a decade. The financial impact is severe; a bankruptcy will stay on your credit report for 10 years. Every time you apply for credit, whether it is a home, a car, a lease, or insurance, you will be impacted. The long-term effect of higher rates many times greatly outweighs the shorter-term impact of filing bankruptcy. Additionally, most people do not realize that bankruptcy can stay on their court records for over 20 years - which means it can follow someone for the rest of their life. If you apply for a job, a loan, rent an apartment, or even insurance your bankruptcy filing is easily uncovered. Lastly, I have yet to find someone who is proud of filing bankruptcy. Most people will do anything to avoid filing bankruptcy Bankruptcy is not an easy or even quick fix. It is a very serious decision with serious consequences. If you are considering bankruptcy, you should consider contacting a lawyer to discuss this option.

A “Debt Negotiation Program” is a great alternative to bankruptcy. Your credit rating is protected from bankruptcy and your debts are reduced. Best of all, your creditors accept the settlement amounts as payments in full, making you debt free without having to suffer the long-term financial, emotional, and social impacts of a bankruptcy. Many people are ecstatic to find an alternative to bankruptcy that still solves their debt problems.

Credit Card Monthly Payment

Unfortunately, millions of Americans who are struggling with their Credit Card Debt continue to just barely make their monthly payments. Most of these people just keep doing whatever they can to continue making minimum payments for the rest of their lives. If you are facing severe financial hardship, this is a no win situation. If you are only meeting your minimum payments, you are paying almost entirely interest charges; not paying down your debts. This means that if you owe $10,000 today, it will cost you more than $20,000 over the next 20-30 years before you are debt free. And if you can’t keep making their minimum payments, the creditors will begin harassing you. If you don’t find help, you could end up with judgments and garnished wages as well as liens against your property. A Debt Settlement Program allows you to minimize creditor calls, avoid bankruptcy, avoid new debt and come to an agreement with creditors on your terms, not theirs.

Lets talk about Debt. How we’re getting out. How we got there in the first place. I’ll be standing by here to chat with you!

You’ve Got Rebate! How Will You Spend It?

I suggest that you do the selfish thing: Put it to use where it will do you the most good

Congress has still got some talking to do, but the general consensus says the Tax rebate will be approved, meaning Individuals who pay income taxes would get up to $600, working couples $1,200 and those with children an additional $300 per child under the agreement. Workers who make at least $3,000 but don’t pay taxes would get $300 rebates.

Here’s a short excerpt from Bloomberg. You can get more details at the Treasury.

Bush and House lawmakers yesterday agreed on a $150 billion economic stimulus package aimed at avoiding an election-year recession. About $100 billion would pay for tax rebates to about 117 million families and $50 billion for business tax breaks.

The package also addresses the growing number of housing foreclosures with a provision allowing Fannie Mae and Freddie Mac, the largest U.S. mortgage-finance companies, to temporarily buy mortgages of as much as $729,750, up from the current limit of $417,000.

 And for sure, nothing is set in stone, though the House has voted, the Senate seems to be at a stand still and POTUS hasn’t signed a bloomin’ thing.

So tell me, what will you so with your rebate?

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