Student loans have become a part of the national conversation lately. On the news, there is a significant amount of coverage about the government decision to let current student loan rates double over the summer; and the tough job market has made the burden harder to carry for graduates. Student loans are a fact of life for many people, and are necessary to cover the extremely high cost of education at some colleges and universities. It’s difficult, but possible, to work full time through school as more colleges and universities offer online and distance learning programs. However, those programs still require a huge time investment by the student which leaves less time to work. Student loans can be an important supplemental source of school funding for those who are working their way through college as well, and smaller loan amounts do not equate to less problems if those loans go unpaid.

With the United States slowly climbing out of the greatest economic downturn since the Great Depression, people are adapting to a new reality of saving and austerity. For many the combined debt load of a mortgage, student loans, and/or credit cards; along with a lack of income, medical hardship, or difficulty getting into the desired field can leave students with monthly student loan bills that continue to increase. Unlike other types of debt, government backed student loans are not able to be discharged through bankruptcy. Private loans can be, but bankruptcy should always be an absolute last resort. Federal and private loans often require different approaches and resolution strategies, and it can take a long time to get out of student loan debt. Even President Obama did not pay off his student loans until his book became a bestseller.

While student loans offer a great benefit during school, they can become very difficult to repay. The combination of rising cost of living and the difficult job market for entry level jobs out of college has contributed to the rising amount of student loan debt. Unlike the mortgage and banking crisis however, student loans are not a bad asset. It is true that people are having a hard time repaying them. But the majority of people who owe student loans will end up getting paying jobs at some point in time which will allow them to pay down their loans. Because unlike “default credit swaps” or “subprime mortgages”, these are not complex derivatives or trading options; they are simply the aggregate amount of money college students in the US have borrowed to pay for their education. These are investments in people that are just beginning their careers for the most part; or getting degrees to further careers they already have.

This does not diminish the crushing weight that student loans can carry, and the stress they can cause. The cost of education has skyrocketed at the same time that people are being encouraged to continue on to higher education even after a bachelor’s degree. Choosing a college major can be a difficult choice, and it’s common for students to switch majors, or even schools, several times on the way to obtaining their degrees. Unfortunately, there is no “do-over” on the loans that were taken out for the previous major, and because not all credits transfer across majors or to different schools and departments, changing majors or moving schools can be a big contributor to a large student loan burden. Monthly student loan payments can be very difficult to manage, especially right after graduation or when a deferment ends when the job hunt may still be going on.

In a CBS News article, it was mentioned that on average, someone with $60,000 of student loans would have a standard payment of $690 per month for a 10 year term, with interest included. That is a large chunk of a recent graduates monthly budget, and with living expenses, rent, and insurance, not to mention a car or house payment; the total can easily be much more than a starting salary or hourly entry level position. If someone is unemployed or job hunting, it can become impossible to pay that much.

The good news is that recent measures have been taken by Congress and President Obama that make it easier for struggling post-grads to find help. The bad news is that they will not automatically move someone on to a better program, so action is required by the person who owes the loans to initiate the process. The best way to do this is by contacting a reputable company or nonprofit with certified staff. There are many programs and options available, and some can overlap to provide even more benefits. Payment plans combined with federal student loan consolidation plans help to keep student loans manageable and organized with one interest rate and one monthly payment.

Other programs such as Income Based repayment programs offer much lower monthly payment amounts than the standard plan for most people. According to a CBS News article, the standard monthly payment for someone with $60,000 of debt would drop by $451 per month, reducing the payment amount to just $239 per month. This figure is also calculated for someone with $40,000 income per year; so an individual with less income would have an even smaller payment. The CBS News article goes on to state that there are nearly one million people who are now on the standard repayment plan,who qualify for a lower monthly payment and a new payment plan.

One of the most promising programs was enacted by Congress several years ago and is aimed at recruiting more promising graduates to public service fields such as Law Enforcement, Public Education, Public Health Professionals including nurses and health care support occupations, 501(c)(3) Non-Profit organizations, Goverment professionals (local, state, and federal), Military, Public Safety, and Firefighters, among many others. This incredible program offers Student Loan Forgiveness after 120 consecutive payments, and whatever is still owed at that time is erased.

Although student loans have become part of the national conversation lately, mostly due to surpassing the amount of credit card debt, there remain many options for those who have used student loans to further their education. The fact that student loans are essentially an investment in the future careers of millions of Americans means they are solidly backed, unlike the unregulated financial instruments that contributed to the subprime lending crisis and the Recession. However, until the economy picks up and graduates are able to gain experience and on-the-job skills, the pressure exerted by student loans on monthly budgets of recent graduates will be significant. This underscores the need to contact a reputable company, non-profit, or certified professional to see what options are available for those with high student loan amounts.

Sources: CBS News http://www.cbsnews.com/8301-505144_162-41542897/student-loan-help-have-you-signed-up-yet/

USA Today http://www.usatoday.com/money/perfi/college/2010-09-10-student-loan-debt_N.htm

Many people have heard of the concept of using a credit card for emergencies, or have used their own card for emergency situations. Credit cards are very convenient especially in a crisis such as a medical emergency, loss of employment, or other financial hardship. While they work great as a short term fix for something that can be paid off at the end of the month; cardholders encounter bigger problems when credit cards take the full role of an emergency fund during an extended hardship.

The issue with using credit cards for living expenses after a loss of employment and/or medical problem is that they charge a high amount of interest and often have complicated user agreements.

The more credit someone uses; the higher their debt-to-credit ratio becomes. A high debt-to-credit ratio can result in credit card companies increasing rates or minimum payments; or lowering lines of credit, because someone using a high amount of their available credit represents a risk in the eyes of the card issuing company.

When savings are depleted and one uses their credit card to rely on during tough times, all it takes to get in serious trouble is one late payment or mistake. This in turn causes a cascading effect of raised interest rates, lowered lines of credit, and raised minimum monthly payments; which can become impossible to stay on top of if there are no other savings available. Another way that people can turn to credit in times of crisis are through the seemingly harmless overdraft lines of credit on a bank account. This makes it automatic to rely on credit when bank savings are depleted, and it can quickly become too easy to use despite usually high interest rates.

Credit cards have a purpose, and they are best used when they can be paid off every month with no revolving balance. However, they also represent a risk and require discipline with spending. Having a bank-linked debit card offers many of the conveniences of credit cards, with less of the liability. It can still be easier to spend than actual cash because of the “plastic factor”, so keeping a list and balance of all expenditures on the card is helpful.

Last year, a study was released that showed two thirds of Americans cannot afford a $1,000 emergency through cash savings. Only 36% of respondents would respond to such an emergency using emergency funds; while the remaining respondents would use a credit card, ask a family member for cash, or try to get some kind of loan. This speaks highly about the need to self educate about financial matters and how important it is to work hard on and stay with a budget.

Of course, a personal hardship such as a medical problem or loss of employment can really shake one’s personal foundations when there is nothing to cushion the blow. Living within budget while making income; and making that emergency fund a top priority are good ways to cushion somewhat the financial blows and setbacks of life, such as unexpected car repairs, home repair or rental issues, and medical problems.

Renowned financial counselor Dave Ramsey is a big advocate of the emergency fund, and saving $1000 is the crucial first step in his financial counseling plan. The reasoning behind this is so that as efforts are made to pay off or pay down debt, an unplanned minor emergency will not derail debt repayment plans. After the $1000 emergency fund is established; the ultimate goal that Ramsey and other financial counselors advocate is to save 6-9 months of living expenses to truly plan for an unexpected job loss or other unplanned scenario. This is a great goal, but with so few people even saving $1000, it can be difficult to reach. No doubt; tough financial times have many families and individuals too cash strapped to even consider a $1000 emergency fund; and establishing this fund should obviously not come in place of food, housing, or transportation to a job. However, it is a good goal to aim for.

Some of the ways Mr. Ramsey recommends to try to fund an emergency account include taking a second job, cutting down on expenditures such as eating out, shopping, and non-business travel, carpooling or riding a bike to combat gas prices, and cutting off cable services in favor of Netflix or local channels. While there can be many ways to fund an emergency account; maintaining that goal, and starting with $500, or $100, can be a good way to begin the saving process.

When the emergency account is funded, it should be used in financial or personal emergencies, and then refunded as soon as possible after. Credit cards have a purpose, but using them for everyday expenses and maintaining an account balance does not help anyone financially except the credit card companies. For that reason, it’s best to pay the cards off each month, and establish a buffer account for life’s inconveniences and larger problems at the local bank or credit union.

Sources:
Most Americans Can’t Afford a $1000 Emergency Expense. CNN Money, August 11 2011. Accessed 4/30/12 http://money.cnn.com/2011/08/10/pf/emergency_fund/index.htm

9 Ways to Build Your Emergency Fund. DaveRamsey.com. Jan 19 2012, Accessed 4/30/12 http://www.daveramsey.com/article/build-an-emergency-fund-fast/lifeandmoney_saving

Debt collector abuses have been growing at an alarming rate over the last several years. Particularly during the tough economic downturn, complaints against debt collectors have increased by tens of thousands per year. There are certainly great debt collectors out there who do their job with integrity and follow all the rules. Unfortunately, it’s the collectors who flaunt the rules and use intimidation and deceit that give a bad name to their profession. Some of the more egregious acts by debt collectors have been high profile news stories, such as one medical debt collection firm that went so far as to plant their employees in hospitals where they would pressure patients to pay previous bills. While that particular instance is an example of debt collecting taken to an extreme, there are many other violations that affect consumers that happen on a regular basis.

The Fair Debt Collection Practices Act protects consumers from unethical tactics by debt collectors, but it is up to individuals to exercise their rights and stand up to rude debt collectors. Owing a debt is not a crime, it is a civil matter. It is also not a sign of a moral or personal weakness; but the result of circumstances that are both in and out of the consumer’s control. A budgeting mistake or layoff may land someone in credit card debt, but the excessive fees and business model of credit card companies make it very difficult to climb out of debt once the process has begun. More often, it can turn into a snowball that can cause stress, financial problems, and difficulty concentrating due to those persistent debt collection agents.

Working with a reputable debt relief company can make some of these challenges easier to deal with. Experienced industry specialists and certified financial counselors should be well versed in the F.D.C.P.A. and how to coach clients on utilizing the consumer protections that come with it.

One of the most important consumer protection provisions in the F.D.C.P.A. is the ability to have a debt validated; or verified by the creditor and collection agency. This process involves sending a written communication to the collecting creditor requesting that the account be validated. By law, the creditor is supposed to comply and deliver documents, contracts, or other evidence that will verify and validate the debt as being owed by the consumer. This is especially helpful in the unfortunate circumstance of collection agencies trying to collect on a debt that belongs to a different person with the same name, or different person at the same address. The more unscrupulous collectors will just try to get a payment, and may ignore someone’s verbal requests to be left alone or that the debt is not theirs. With a validation letter, the creditor is forced to come up with proof.

However, validation requests are sometimes fulfilled with a few photocopies of old statements, or are otherwise handled half heartedly. This may be an instance when the consumer can take legal action against the creditor. Validation is a procedural mechanism that should be used whenever the authenticity of an account is in question. If the account is validated by the creditor or collector, it can accelerate the collection process by getting the attention of the collector, so it is a good idea to be prepared for that if validation is used.

Validation can be a very helpful tool especially when an account is mixed up with someone else’s, or if it is really old. The longer an account has been owed, the more collection agencies or debt buyers could have purchased and sold it, which means that the original documentation may not have been transferred properly or at all. An important final note about validation – the collector must cease collection efforts, including calls, during the 30 day validation period that begins as soon as they receive the letter, which is a good reason to get a proof of delivery service when mailing.

Another common FDCPA defense is the Cease and Desist. This consumer provision allows an individual to supply a third party collection agency with a binding letter that requires the collector to cease and desist all communications. This is usually used to stop a barrage of harassing phone calls that are very common with some collectors. It is important to keep track of the debt and efforts to repay it after enacting this provision, as the collector will not be able to contact the consumer by phone after they receive the Cease and Desist.

For this reason, it’s a good idea to send it by Certified Mail, or to request proof of delivery. Sometimes collectors will violate Cease and Desist orders, but they do so at the risk of legal action because that is a clear violation of the FDCPA. The section that deals with Cease and Desists says that collectors are allowed to contact the consumer one more time after they receive the letter, and that is only to inform them that they have received the letter and are complying. In my experience this rarely happens however, and phone contact is stopped immediately. This strategy only works with third party collectors and not the original credit card or company, but there are ways to deal with those calls as well.

It is a good idea a Cease and Desist situation to specify that the creditor may contact you by mail or fax, to stay updated on the account. Any payment arrangement will need to be on paper anyway, and by cutting out the harassing calls and the pressure they create, it becomes easier for an individual to take an objective approach to resolving their debt.

While these provisions are available for anyone to use, it can be valuable to consult with an I.A.P.D.A. or N.A.C.C.C. Certified Debt Specialist for complex debt cases over $10,000. The International Association of Professional Debt Arbitrators and The National Association of Certified Credit Counselors are two of the leading industry education and certification programs; both accredited with mandatory continuing education. When choosing a company to help fight back against debt collector abuses, it’s important to look for industry certified financial counselors on staff. The combination of experience and training through one of the best certifying agencies helps Certified Debt Specialists create a specific strategy for dealing with obnoxious collectors; incorporating FDCPA defenses throughout. If a case is serious enough, direct referral to a consumer law attorney who specializes in going after FDCPA violations is necessary.

Dealing with one or two small accounts in collection can be done by most people as long as proper records are kept; including calls, payments, and mail receipts. By utilizing the Validation and Cease and Desist provisions in the FDCPA, consumers can limit harassing calls from third party collectors, as well as using validation to make a collector back up its’ claims. Of course, some collectors may also violate the FDCPA in their response, or lack of, to a consumer mailing in these types of letters. If a collector continues to harass an individual after they have sent a Cease and Desist, or if a collector refuses to validate a debt at the consumers’ request, it’s best to seek a legal remedy through qualified counsel. Although debt collection abuses have been increasing, the provisions of the FDCPA allow consumers to fight back against the worst of debt collector harassment.

These provisions play a key role in long term debt reduction programs and enhance communication between negotiators and collection agents. The collectors are much more likely to try to work out a good settlement with a Certified Debt Specialist if they are unable to reach the consumer. Since collectors know they have an advantage by working in the industry, they will attempt to badger, cajole, and deceive consumers into payment arrangements they cannot afford. Collectors will also use their tireless skip tracing campaigns to locate different home and cell phone telephone numbers of people with the last name in the same area as the consumer who owes a debt, so this is another good reason to be prepared to write a Cease and Desist.

The debt buying and collection industry is very profitable, and the high pressure environments can lead collectors to make poor choices in attempting to collect. The provisions in the FDCPA help consumers take the initiative in addressing unruly debt collectors, while Certified Debt Specialists and direct referral to consumer law attorneys remain good options for clear FDCPA violations and complex debt problems.

SOURCES:
FDCPA Resource, Federal Trade Commission Website, accessed 5-2-12

http://www.ftc.gov/os/statutes/fdcpajump.shtm

The amount of debt across all lines that Americans owe has been greatly reduced since its’ peak in 2008. Even in a difficult economic environment, with many still out of work or underemployed, people are taking the necessary steps to pay down or pay off their credit card debt.

With credit card companies still charging very high interest rates and making billions of dollars per year on fees and overdraft charges, paying down credit card debt certainly isn’t the easiest thing to do. Professional help is also available to help people negotiate interest rates and balances with their creditors, and choosing a company such as Horizon Debt Group to help with an overwhelming credit card balance is a big decision. In the author’s opinion, being both experienced at dealing with banks and collectors and employing industry certified specialists are the two most important criteria when choosing a debt servicing agency.

Paying down debt is often a long journey especially when undertaken alone. Reaching the peak of the mountain after sacrificing and keeping an extra tight budget is such a rewarding and empowering event, and the larger the debt, the bigger the pesonal victory. While personal finance is still one of the topics that people hesitate to discuss with even their best friends, the truth is that many people from all walks of life can accumulate credit card debt, for all sorts of reasons. Most would not think of people earning six figure salaries as being able to accumulate a problematic amount of debt, but I know of several individuals who have had that happen. The more someone makes and the better their credit score, the more banks and lenders are willing to give them; or were willing to give them in the relaxed lending environment before 2008. This type of scenario can create a burden that only becomes a real problem after a personal loss of income or a broader economic recession.

In October 2008, the total debt for student loans, credit cards, auto loans, mortgages, and other types of credit was 12.4 Trillion. The plummeting stock market, depreciation of home values, and rising credit card interest rates and fees created a very difficult environment economically. However, the total amount of debt owed across all credit lines is now more than $800 billion, so a major reduction has happened in the last four years. This is an encouraging sign of Americans’ resilience during difficult times.

Credit card debt as an amount of yearly income has also decreased since the end of 2010, and that trend continues now. The credit bureau Equifax has released two years of studies ranking the cities with most credit card debt. The top two cities in 2010, Canton OH and Wilmington, NC both had more than 17% of average yearly income spent on just credit card debt.

In 2011, the top two cities, El Paso TX and Virgina Beach, VA, were in the 10­11% range of yearly income spent on credit card debt. This illustrates a broad drop across the board with percentage of yearly income spent on credit card debt, which is a good sign that people are paying down debt and freeing up resources to spend on other ventures.

Interestingly, the average amount of credit card debt owed per household also differed significantly in the 2010 and 2011 studies. In 2010, the number one city of Wilmington, NC had an average household credit card debt of $7,315; while the city with the most credit card debt in 2011 had $5,980 per household. This reflects the further overall decline in consumer debt since 2008.

There is no doubt that hard work in the private sector and increased consumer spending are helping to drive the recovery. We still have a heavy credit card debt load to work out of; and student loans are also creating a lot of pressure for households. Through continued hard work, budgeting, and seeking professional financial assistance when necessary; Americans will continue to knock down credit card debt and gain household financial strength.

Horizon Debt Group, LLC is a Credit and Debt Assistance firm that has helped many consumers overcome their unique financial challenges. We invite you to take advantage of the many resources Debt Assistance Services has to offer starting with a free consultation with a Certified Credit Counselor.

We have partnered with a true national law firm. Our partners have law offices in all fifty states. Our professionals are dedicated to helping our clients resolve their debt problems. We provide Debt Assistance Services nationwide and we have a professional alliance with many of the nation’s most reputable Debt Assistance Companies to assist our clients as advocates for their rights.

For years large corporate law firms have helped business clients solve their debt issues by negotiating “financial workouts” with their creditors allowing them to stay in business and work through difficult financial times. Horizon Debt Group, LLC and our preferred partners have created a cutting edge Debt Assistance Program to provide our clients with these same types of services allowing you and your family to focus on more important issues in your life. Like a security blanket, our partners provide all the law-related services you need to resolve your debt.

Many Debt Assistance Companies promise results and advertise exceptional settlements as commonplace. Horizon Debt Group Debt Assistance is different. We have partnered with experienced attorneys and trained legal advocates. This is our guarantee to you: If we do not reduce your debt by at least 35% of what you owe, we will refund your fees for settling that particular debt and still resolve the debt on your behalf.

We have partnered with a true national law firm. Our partners have law offices in all fifty states. Our professionals are dedicated to helping our clients resolve their debt problems. We provide Debt Assistance Services nationwide and we have a professional alliance with many of the nation’s most reputable Debt Assistance Companies to assist our clients as advocates for their rights.

For years large corporate law firms have helped business clients solve their debt issues by negotiating “financial workouts” with their creditors allowing them to stay in business and work through difficult financial times. Horizon Debt Group, LLC and our preferred partners have created a cutting edge Debt Assistance Program to provide our clients with these same types of services allowing you and your family to focus on more important issues in your life. Like a security blanket, our partners provide all the law-related services you need to resolve your debt.

Many Debt Assistance Companies promise results and advertise exceptional settlements as commonplace. Horizon Debt Group Debt Assistance is different. We have partnered with experienced attorneys and trained legal advocates. This is our guarantee to you: If we do not reduce your debt by at least 35% of what you owe, we will refund your fees for settling that particular debt and still resolve the debt on your behalf.

Debt can happen to anyone!

Don’t let outstanding debt or credit card balances control your life. With a Debt Assistance Program from Horizon Debt Group you can take charge of your finances and eliminate your debt fast. Debt Assistance has the solution for all of your Debt Assistance needs.

Let our financial advisors, innovative technology, and the best negotiators in the business assist you in finding the right solution for your debt problem. By providing simple and sound advice and Debt Assistance services, we help our clients rid themselves of debt quickly and easily.

The Credit Card Companies got their Bail Out. Did you get yours? Get your FREE information on how to settle your debt for pennies on the dollar. Fill in the form above or call toll free 888-894-0777.

Debt Assistance Programs

With the down turn in the economy, many Debt Assistance Companies have popped up over night. These Debt Assistance Companies are only interested in collecting their fees and have no interest in helping their clients. Most Debt Assistance Companies don’t tell you about their fees. That is because they charge 15%-18% of your total debt as a fee and they collect their fee before they ever settle any of your debts. With most Debt Assistance Companies, all of what you pay into their program for first 12-18 months is taken by them in fees. This gives you very little chance of completing the program and gives them no incentive to do their job. This is why congress recently held hearings on the Debt Assistance industry and may soon pass legislation to regulate the way fees are collected and disclosed.

With a Debt Assistance Program from Debt Assistance you pay a small, fully refundable enrollment fee to go on the program, then the bulk of our fee is based on a percentage of the amount forgiven by your creditors. In other words the more we save you by getting a lower settlement, the more we collect as a fee. The settlement fee is only collected after a settlement has been reached with your creditor. This gives us incentive to get you the best possible settlement. Since all of your payments for the first 12-18 months are not being taken in fees, you start saving for settlements right away and you will be debt free much quicker.

Not all Debt Assistance Companies are the same. If you owe thousands of dollars in unsecured debt and you can no longer afford to make your payments, you may want consider our unique Debt Assistance Program. Find out if our Debt Assistance Program is right for you, fill out the form on the upper right of this page to receive your free information, or call toll free 888-894-0777!

With Americans suffering from large and small debts, many harassing phone calls, letters, and even in person visits have sparked the Federal Trade Commission to take action. The collectors have crossed a line and the FTC is now taking strong action against any company trying to collect a debt with deceptive actions. Some of these debts consumers might not even be obligated to payback.

Asset Acceptance was on the wrong end of a $2.5 million civil penalty recently because of a lawsuit they decided to settle. The company was charged with deceiving consumers when they tried to collect old debts. This is the second-largest penalty the FTC has ever assessed and part of a larger effort to protect consumers.

Over the past two years, the FTC has pursued eight different cases against debt collection companies. This is due to a large amount of consumer complaints against these companies, which rose 17% from 2009 to 2010 and continues to rise every year. These complaints have caused the commission to look into the companies named in the complaints.

Some of the reasons these companies are paying large settlements is what they withhold from the consumer. Asset Acceptance, for example, failed to inform consumers that they couldn’t be sued for their failure to pay older debts. They also deceived consumer by letting them pay a small amount towards the debt, but not telling them this would extend the amount of time the company could sue them over the debt.

Most consumers don’t know the laws and regulations in place to protect them when they owe a debt to creditor. This is why the collection agencies are legally obligated to inform consumers of their rights. When they don’t do this, they are doing a disservice to the consumer they are working with and using collection tactics that are both illegal and unethical.

The statute of limitations for how many years a debt collector has to sue a consumer varies from one state to another, and ranges from two years to 15 years. This period of time starts when a consumer is late or misses their first payment and every single time that consumer makes another payment the timeframe is extended. Even if the consumer has not paid a single penny towards the debt in many years, just one small payment restarts this timeframe.

Another issue the FTC finds with the debt collection companies that buy old debts for a few pennies per dollar is that they report inaccurate information to the credit agencies. This causes issues with the consumers credit report and credit score. Another problem with the way Asset Acceptance was trying to collect debts had to do with their failure to investigate cases when a debt was disputed through the credit agencies.

Within the settlement, the company is now required to inform any consumers with debts too old to be collected and tell them they will not sue. They must also investigate any disputed debts and must make sure that their claims are reasonable before they go after the consumer. They must also inform consumers before reporting any debts to the credit agencies.

It wasn’t the largest settlement ever, but it was close. West Asset Management agreed to pay $2.8 million in the largest settlement ever due to violations of the law when trying to collect debts. These are just two of the eight cases over the past two years between the FTC and debt collection agency.

Due to the magnitude of this issue, the FTC and the Consumer Financial Protection Bureau now share the duties of enforcing these laws. The only difference is this new bureau can actually write new debt collection rules, whereas the FTC cannot. Either way the goal remains the same and enforcement of legal debt collection remains at the top of the priority list.

Many Debt Settlement Companies promise results and advertise exceptional settlements as commonplace. Horizon Debt Group Debt Settlement is different. We have partnered with experienced attorneys and trained legal advocates. This is our guarantee to you: If we do not reduce your debt by at least 35% of what you owe, we will refund your fees for settling that particular debt and still resolve the debt on your behalf.
Call 888-894-0777 For Your Free No Obligation Consultation.

When you’re in debt to the government, it can force you to live a stressful life.  You don’t need to live with this weight on your shoulders anymore.  Many reasonable solutions can help you get the tax debt relief you need and help get that monkey off your back.  If you don’t pay back your IRS debt, you could lose your home, your car, your business, and many other things you own.

Depending on the size of your debt, you can choose from different options to resolve your tax debt.  Some of these options will require paying the debt in full, while others will offer a settlement option to help save you money and pay off the debt faster.  It all depends on what type of tax debt resolution fits best for your situation.

The Most Common Three Tax Debt Relief Options

1.  A Monthly Arrangement with the IRS

The easiest way to pay back your tax debt comes in the form of monthly payments.  The IRS will often offer those with back taxes the option to pay a specific amount every month to erase the debt.  They will work with you and make sure you can afford the payment.  For those with a smaller debt, paying it back with monthly payments is the best option.

2.  Hiring a Settlement Company

An option for those with much larger debts, will allow paying less to settle the debt.  If you owe over $10,000, then you may want to consider hiring a company to help you settle your debt.  Tax debt relief comes in many forms designed to help individuals and businesses gain freedom from the debt.  This option allows those with a large amount of debt to settle it for a much smaller amount.

3.  Declaring your Taxes Uncollectable

If you can make a solid case why you cannot pay any of the debt back, you may get relief without paying a single penny to the IRS.  Many will not qualify for this option, but some might.  Consulting a tax attorney or an IRS specialist can help you find out if this is even possible in your situation.

The IRS also offers a temporary relief method similar to this one.  However, during the time you cannot pay any money towards your taxes, the debt still accrues interest.  This option helps for a temporary amount of time, but it’s not a permanent solution.

Popularity in a Tax Debt Relief Option

Most will need to hire a settlement company to help them resolve their tax debt.  This present the issue of finding the right specialist to help, you settle your debt for less than what you actually owe.  Most of these companies can cut your debt significantly and stop the collection calls from the IRS.

You want to look for a company with a great reputation.  It won’t help if you choose a company not qualified to settle your IRS debt in the best way possible.  Some tax settlement companies simply don’t provide the service you need and you don’t want to end up with the wrong type of company.

A company with specialists that actually understand how the IRS works gives you a significant advantage.  You want to settle your debt for the lowest possible amount and using just any tax debt resolution company isn’t an option.  Read the testimonials the company offers and make sure you feel confident in the choice you make.

Understand that dealing with back taxes or even current taxes presents a serious matter.  It’s not easy to settle your own IRS debt and hiring a professional company will only benefit you.  Make sure you choose a company with a quality reputation and you will be well on your way to experiencing the tax debt relief you deserve.

Jeff Wilson (name changed to protect privacy) was always a hard worker, whether working for his telecommunications company during his 30 year career, or serving his country as a medic in the Korean War. Throughout his life, he witnessed many economic, political, and social events that changed the world around him. Throughout all of this, Jeff managed to move forward and climb his way up the corporate ladder, where he started working on basic parts as a young man after the war. Through hard work, loyalty, and developing a reputation for getting the job done, Jeff eventually became one of the highest paid technicians at his company, taking home well over $100,000 a year. He raised a family and saw two kids off to college and into blossoming careers of their own.

Jeff is by all accounts a successful, hard working American. He had good investments, paid off his credit cards on time, and made regular monthly payments on his mortgage.He began investing his significant savings into different assets, including rare coins and memorabilia. Jeff developed a close relationship with a few antique coin dealers; they seemed to have great advice and they were friendly, positive guys. Before he knew it, he had invested nearly all of his savings into rare coins. He knew that it was a good investment though; the coin dealers had promised large returns and they seemed to know what they were talking about.

By the middle of 2007, Jeff noticed some of his assets beginning to depreciate a little. It wasn’t much cause for concern, but it did cause him to second guess his investment, and the advise from the “experts” he trusted. Then, the bottom fell out of the economy, and like so many Americans, Jeff watched the value of his assets and his home plummet. Luckily, he was caught up on mortgage payments and only had 5 more years of payments until the house was fully paid off. However, the loss of assets came as a shock, and he was down to nearly a third of what he originally invested. Even worse, he had bought nearly $100,000 of the coins on credit that he had been making payments on. One of the coin dealers convinced him that it was okay, and he had broken his habit of paying off credit cards every month. While this was a rising tide of bad economic news, Jeff was still employed, and still in his house.

Then, during a routine doctor visit, he received the news that no one wants to hear. Cancer. Fortunately, it was detected early enough, and through several rounds of chemotherapy and months of prescriptions, the doctors told him that it was in full remission. Jeff had beaten one of the most feared medical problems known to man. In the meantime, the credit card bills had piled up, the medical bills came pouring in, and it seemed that there was a new penalty fee or raised interest rate every day. Jeff was now renting, as he had to sell the house he lived in for 28 years to pay medical bills. He didn’t dare cash in any of his coins, and hoped they would once again be able to build value. But every day he checked, the rates stayed low and it began to look more and more like he was going to have to adjust the new reality of working his way out of debt.  He was making all of his payments on time, but it seemed like it would take a long time to get over his debt.

He had been receiving calls from someone who claime to work for a company that could reduce his debt amounts. The only problem was, he wasn’t a certified professional and had been pestering Jeff to pay hundreds upfront and enroll his debt in the new program, which he said would be much faster.

Without really giving it much thought, he enrolled his debt in the new debt service from Five Mountain Financial and began paying them upfront fees before anything was done with his debt. Busy working overtime at TeleSun; he was still bothered by thoughts of his debt during the day at work. This seemed like a very hands – off approach, and he had not been able to get in touch with anyone at the debt company. He made his regular payments for several months; but one day, while he was eating dinner after work, Jeff got a phone call from Discover Bank.

They were extremely demanding and Jeff began to get a little worried. They said they had not heard from his new debt agency at all and that he was going to be sued in court over the debt! Jeff took down the collector’s information and then tried again to call Five Mountain Financial. He heard the familiar voicemail as he felt his temper start to flare. How could they take these payments each month and then not even pick up his calls? Even worse, Discover Bank was talking about lawsuits!

Still upset, Jeff walked into his computer room and sat down. The old way of dealing with things wasn’t working. He decided to be proactive, and found a company with a good BBB rating which was made up of Certified Debt Specialists.

The C.D.S. that Jeff talked to was very understanding and immediately helped Jeff understand that companies are no longer allowed to charge upfront fees. The C.D.S. also helped Jeff compose some letters based on consumer protections in the Fair Debt Collection Practices Act which stopped a good amount of the phone calls that had been pouring in from collection agencies. Jeff decided to cancel with Five Mountain Financial, and stopped paying them hundreds of dollars per month.

The specialist who was assigned to him immediately started tackling the biggest problem, Discover Bank. Within a day, the certified specialist helped Jeff reach an agreement that he could pay with Discover. He also referred Jeff to an attorney in his state who dealt with credit card lawsuits, if he ever happened to get one. Jeff learned that was an occasional occurrence when debt is negotiated, so it was good to be prepared for the other accounts.

Then, the specialist got to work Over the next several months,  Jeff received a negotiated agreement to pay 30% of the amount owed on one card, 45% on another, and 42% on another card. He started to believe for the first time since this all started, that he would be able to avoid the lengthy bankruptcy process after all. He only made payments when each agreement was negotiated and paid; and he liked that the amount he paid was based on the amount that was saved. So that’s what Performance Based Debt Negotiation means, he thought. Things were going so well that Jeff decided to make a big decision to speed up the negotiation process: he cashed in on a portion of his antique coins and memorabilia and put it in his settlement fund. The settlements progressed rapidly, and by the end of the year, 9 months after he started working with a Certified Debt Specialist, he was completely out of debt. $176,000 was the total amount of debt he had started with, an amount that seemed to leave no option but bankruptcy or lawsuits. By making personal financial sacrifices and coordinating often with his C.D.S., Jeff was able to stick to the program and save a large percentage of what he owed, enabling him to overcome financial hardships he had been struggling with for several years.

Jeff’s story illustrates just how complex our relationship with money can be, and the many factors that can overlap in contributing to debt. With a careful strategy and the help of certified professionals, it is possible to deal with large amounts of debt or relatively small amounts. The impact of debt can vary from person to person, including the emotional impact and the way it affects one’s personal budget and use of income. This story is based on a real life client of one of the Certified Debt Specialists at Horizon Debt Group.

Given the fact that the economy is slowly recovering in a way that many people have yet to really benefit from, household financial problems stemming from the Recession are still causing problems for many Americans. An Associated Press poll taken in early December 2011 showed a full 68% of the people responding saying that 2011 was a bad year.

Undoubtedly, the tight lending environment and continually high amount of foreclosures and bankruptcies are making it difficult for Americans to get back on their feet financially. Add in the pressure of unpaid taxes and increasing penalties, and it can quickly seem like a very difficult situation with a very intimidating creditor.

Unpaid taxes to the IRS can quickly rise to the top of the list of household financial problems because of the many intrusive collection efforts used by the government.

Benjamin Franklin famously said, “Nothing in this world is certain but death and taxes”. That may be true, but just because taxes are inevitable doesn’t mean that consumers are powerless against delinquent taxes, penalties, and liens. However, the serious potential consequences of unpaid taxes require a careful look at the options available and the desire to take action on the part of the individual, family, or business.

Unlike a traditional creditor, the IRS wields much more potential power over the lives of those who fall behind. From property seizure to bank levies to wage garnishment, the IRS has a wide range of procedures to collect on unpaid taxes.

Difficult though it may be; recognizing that there is a problem, facing the situation and taking preventative action is by far the best option, rather than letting taxes go unpaid while penalties pile up and the risk of a tax lien increases. Tax liens have wide ranging negative effects that can affect all aspects of an individuals’ personal and business life.

Federal tax liens can stay on personal credit reports indefinitely. This can pose a major problem by not just affecting an individual’s ability to obtain credit; but also their ability to buy a house or car. It is also becoming common for credit checks to be performed by potential employers as well as for apartment rentals.

On the news we often see stories about multimillion dollar tax settlements between big corporations and the IRS; or see a high powered business professional go down for unpaid taxes. The negative consequences make for good TV ratings, but the reality is that many people have faced this threat before and have emerged successfully.

High income earners and even celebrities are no exception and can have issues with taxes. Linsday Lohan was recently subject to a $93,000 tax lien that was a result of unpaid taxes from 2009, an oversight during a busy year according to her. Although tax issues can be common with celebrities, higher wage earners in general can have greater liability and exposure from excessive tax liens and audits. This exemplifies the need for preventative action to stop small tax issues from becoming big issues, no matter what economic class the individual is in.

Unpaid taxes and the resulting problems have many causes; whether a business is overwhelmed, there is a medical issue that diverts income, there is loss of employment leading to financial hardship; as well as occasional oversight and mistakes. Whatever the cause, this is not something that will go away on it’s own.

Fortunately, there are options available to those who qualify, and the IRS will negotiate and often settle or reduce penalties with consumers if everything is done correctly. By choosing a professionally experienced organization, it is possible to obtain real relief and victory over tax problems within as little as 3-6 months.

Although tax pressure is common for many Americans, with willpower, experienced guidance, and resolve; it is possible to not only tackle tax debt head on, but to emerge victorious.

Sources :

Internal Revenue Service Manual Part 5
http://www.irs.gov/irm/part5/irm_05-017-002.html

“Linday Lohan Tax Problem Common Among Celebrities”  Huffington Post  1/13/12
http://www.huffingtonpost.com/2012/01/13/lindsay-lohan-tax-taxes_n_1203413.html

Associated Press Poll  12/29/11
http://ap-gfkpoll.com/featured/ap-gfk-poll-americans-look-back-at-2011-with-a-shudder-greet-2012-with-open-arms