Question 1

Is California debt settlement for me?

Accepted Answer

That’s a good question, and probably one you should ask your PandA Law Firm attorney during your free* consultation. The truth is that every person’s situation is different. But generically speaking, if you:

Don’t qualify for Chapter 7 bankruptcy. Or,
Don’t want to file bankruptcy.

AND

Have experience saving toward a goal. And,
Can see yourself able to save up to 50% of your total debt within 24 months.

Then debt settlement may be the right option. But you don’t have to worry! The lawyers at PandA Law Firm have experience with bankruptcy AND debt settlement. During your free* consultation, they’ll explain the benefits and differences between both services rather than try to force you in to one or the other like some other lawyers do. Don’t go to a lawyer that only does BK. Get all your options: Come to PandA!

Question 2

What is debt settlement?

Accepted Answer

Debt Settlement is a contract negotiation between a creditor (or debt-collector) and a debtor (or the debtor’s attorney). The goal of this negotiation is to convince the collector to take a small portion of the total balance as Payment-In-Full. In addition, the paperwork that accompanies the settlement offer should ensure that the balance is marked down to zero, and no one can EVER try to collect on that account again. Sometimes debt settlement is used to avoid bankruptcy, but in other cases financially savvy clients just want to get out of debt with as little out-of-pocket as possible.

Question 3

How does debt settlement work?

Accepted Answer

PandA Law Firm will handle all communications and negotiations with your creditors and debt collectors.  When we take your case, we’ll estimate your out-of-pocket settlement amounts.  Once we have that number, we’ll figure out a timeline that works for you, and execute settlements as you save enough money to make the  settlement payments.
Sometimes, our clients have a little bit of money saved before they come in. This savings might be in a 401K, regular savings account, or inheritance.  They may even have enough to pay the balances in-full immediately instead of settling, but they’re smart enough to know that they want their money to work for them, not against them.  At PandA, we handle all types of settlement cases, and will build a plan that works for your situation.

Question 4

Should I consider debt settlement?

Accepted Answer

The short answer is yes.  If you have unsecured debt, such as credit card debt, medical bills, payday loans and personal loans, you should consider debt settlement.  This is true regardless of whether or not you’re considering other debt-relief solutions like bankruptcy or debt consolidation.  The fact is, debt settlement is the ONLY way to get rid of your debt for less than you owe WITHOUT putting a bankruptcy on your credit score.  If you ARE considering bankruptcy, you should DEFINITELY consider debt settlement before filing.  In some cases, you’ll pay less in a debt settlement plan than you’ll have to pay the courts in your 3-5 year bankruptcy plan.  At PandA Law Firm, we handle debt settlement AND bankruptcy.  You can be sure that we’ll guide you toward the right solution for you.

Question 5

Is debt settlement legal?

Accepted Answer

Yes. In America, any party to a contract has the right to attempt to negotiate better terms at any time.  Credit card agreements, medical service agreements, and payday loans are contracts like any other.

Question 6

Can I settle my own debt?

Accepted Answer

Probably, but it can be tricky.  Choosing an attorney to handle your settlement case will ensure that you get the best settlement results and all the paperwork is in order.  Most collectors will try to add language to settlement contracts that negate the ENTIRE settlement.  In other words, you make what you think is a settlement payment, but really you still owe 100% of the balance.  Debt Collectors can be tricky, and only an experienced attorney can make sure your legal rights are protected both during the settlement, and in the future.  The debt collectors have lawyers, shouldn’t you?

Question 7

How do I know which firm to hire?

Accepted Answer

Make sure it’s a law firm. Some debt settlement companies claim to be attorneys, but aren’t. – Look up any attorney you meet with at www.nvbar.org.
Make sure the attorney handles ALL ASPECTS of Debt Relief. – If a law firm doesn’t handle bankruptcy AND debt settlement, they’ll probably advise you that the one they sell is your best option. When your only tool is a hammer…
Check the attorney’s reputation on the BBB website.
Ask to see a portfolio of some of the firm’s executed settlements – Testimonials.
Other than the fee for the attorney’s service, no reputable settlement firm should “hold your money in trust” or tell you to make payments to them and they’ll pay your creditors – It’s your money, you should be holding on to it until settlements are executed.
Beware of monthly fees. – If a firm wants to charge you $50 or $100/month as a maintenance fee as long as you’re a client, what incentive do they have to finish your file? You should know ALL attorney’s fees up-front, before you EVER pay a dime. It should be a fixed number that doesn’t change based on time / results.

Question 8

Can all debts be taken care of with debt settlement?

Accepted Answer

In most cases, credit card bills, medical debts, payday loans and second mortgages (HELOCS) qualify for some level of debt settlement.  If you have other types of debt (student loans, tax debt, mortgages) a good debt relief firm may be able to provide you with options to take care of those, too.

Question 9

What's the cost?

Accepted Answer

At PandA Law Firm, your initial debt relief consultation is free*.  During your appointment, your attorney will listen to your case and build a customized plan to get you out of debt, and will discuss any associated fees at that time.  To be certain though, our attorneys can usually work out payment plans on their retainers and can start working on your case with as little as $200 down.

Question 10

Why would any creditor accept a debt settlement?

Accepted Answer

It’s a balance sheet thing.  When a debt is settled, it moves out of the “Accounts Receivable” column and splits into two parts; the “Income” column and the “Loss” column.  Companies use those “losses” to offset other items (including any payment on your debt) and reap the benefits of creative accounting.  This is sort of like donating an old couch to charity: The couch is worthless to you, but it’s $200 to the charity.  You get to deduct that $200 off your income when you prepare your taxes.  In addition, when attorneys who also practice bankruptcy law negotiate  settlements, creditors fear that you might be a candidate for bankruptcy; they may get no money at all if you file. Creditors jump to settle debts when PandA negotiates because they know we’re also a bankruptcy firm.

Question 11

How long does it take?

Accepted Answer

The duration of a debt settlement varies from situation to situation, however most PandA Law Firm debt settlement cases are completed in as little as 6-24 months.

Southern California Debt Settlement Attorney