How stupid is “debt settlement” from most non-attorney companies? Really stupid.

Phony debt settlement schemes make you poorer than you were before.

Read article below or more written by Attorney Peter Francis Geraci at

An article in the May 23, 2021 New York times points out how stupid most debt settlement operations are for those struggling with credit cards. On page 39 the story of a single mother and her son is told. The story claims that this single mother is spending 100 a month on credit cards that are not included in another $300 she pays to a private company, to “bundle $27,000 in debt from nine creditors”

The story says that she was paying $246 every other Wednesday, but dropped it to $100 when she lost her 2nd job waitressing. Then creditors “got pushy” and one is taking it to court, and she “just got handed papers from another creditor the other day and started crying”

This sad. Poor lady is getting terrible advice. First, she will never pay back $27,000 in debt at either $500 a month, or $200 a month, unless she gets lucky and pays out that $100 for the next 10 years or more, and never misses.

Each creditor is dividing $200 a month, minus the fees to this “Debt Relief” company, so they might be getting $20 each. Second, look what happened. 2 of the 9 creditors actually filed lawsuits. Some “Debt Relief” Third, she could have filed a Chapter 7 bankruptcy for $200, and she would have been done with it all long again, and included the other debt she is paying $100 a month on.

It is plainly beyond her means to pay even $300 a month to creditors, given her precarious financial position. Not once does the New York Times mention bankruptcy relief, which is the obvious solution to her debt problems. The budget in the article doesn’t make any sense, either.

This is pretty typical of publications like the New York Times, who have some kind of weird agenda, telling stories that don’t help anyone understand how to deal with debt. Attorney Peter Francis Geraci of Geraci Law LLC sees examples of this all the time: well-meaning people getting fleeced by “debt relief” when they should be filing Chapter 7 or Chapter 13 bankruptcy.

Author: Elizabeth Doren Paralegal at Geraci Law L.L.C.

I am a paralegal at Geraci Law L.L.C. (the greatest consumer bankruptcy law firm that ever was or will be!) I talk to thousands of people who are struggling financially.

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