I keep hearing these commercials that talk about “changes in legislation that allow you to settle your debt for half of what you owe.” There is no change or program that allows you to do this. If you default on your loan, then the credit card company will settle with you.
They'll settle after they add fees and interest and turn you over to a collection agency, who will add their fees. Then the company who will “help” you settle will add their fee. By the time you get to where you can settle for half, your bill is almost double what it was to start with. And then, the credit card company will give you a 1099 for the amount they didn’t collect from you, which means you have to pay income tax on that money. Oh, and by the way, your credit is extremely damaged at this point.
I showed a couple who was considering this, how they could pay their cards off and stay out of credit card debt forever! All of this, with no dings to their credit, and doing it faster than the debt consolidation company could get it paid off.
