Dallas/Fort Worth Debt Second Highest in Nation
September 3, 2010
Did you know that the Metroplex ranks among our country’s worst for debt and low credit scores? For the past four years, this area had a higher average consumer debt load and lower average credit scores than as a whole. Among the top 20 largest metropolitan areas, D/FW is second only to Seattle in terms of consumer debt, according to Experian, one of the three national credit bureaus.
In March of this year, D/FW consumers carried an average debt of $26,599 (not including mortgages), while the national average is $24,775. We also have lower average credit scores than the rest of the country. That’s because of late payments compared to the national average, which is a huge factor in determining credit scores. Also in March, Experian showed that D/FW residents had an average of .67 late payments per month compared to the national average of .50. Also factoring into the credit scores is the duration of credit use. The longer your credit accounts are open, the better your credit score. The average age of credit accounts in March were 106 days compared to 111 days nationally.
One major theory as to why credit is so bad is that many people are using their credit cards to get through the current recession. The heavy debt load is evidenced by consumer bankruptcy filings, which are at their highest levels since 2005. In 2009, consumer bankruptcy filings in the Northern District of Texas were up 28% from 2008, according to the American Bankruptcy Institute and the National Bankruptcy Research Center.
If you are having credit problems and you feel you are in “over your head,” our firm can help. We understand how devastating credit problems can be during these difficult times, and we’re here for you.
Don’t Fall for Debt Relief Scams
August 25, 2010
According to a recent article online at Fox News, many substandard debt settlement companies and credit counseling agencies are advertising that credit card bailout programs are available to help pay off your credit cards at deep discounts. These companies even go so far as to fool people into thinking these so-called programs are sanctioned by the government. Through websites, Facebook ads, direct mail, television and more, their promotional materials depict images of the White House, President Obama, American flags and more.
Don’t be fooled; none of these programs are real. When you call one of these companies, you find out that the programs are supposedly not available…but upcoming. They’ll go on to tell you that in the interim, they can help you dramatically lower your debt all by themselves, without the “credit card bailout programs.”
A couple of examples of the bogus ads are as follows:
"Obama's Debt Relief Program Awards Government Grants to Help You Pay Off Annoying Personal Debt."
"... President Barack Obama, in his first few days as the newly elected US president, developed policies and programs to help consumers get back on track with their finances and stimulate the economy ... This government debt relief program is actually intended for all Americans to avail. The only reason why people are not taking advantage of this is that not everyone is aware these programs exist ..."
Not all debt settlement companies use shady tactics to get clients, but their value is questionable in general. Most debt settlement companies tell clients to stop paying their bills and open an escrow account with the company. Once the default happens, the company calls the credit card companies to negotiate a reduced sum with the funds from the escrow account. Then the debt settlement company receives a huge portion of the escrow.
Approximately 60% of people drop out of the debt program within six months and never reap the benefits of the settlement. Once people drop out, they owe an even larger debt than before due to accumulated interest and fees. Additionally, many creditors will take legal action against people trying to utilize settlement companies, resulting in expensive judgments against them.
Due to the plethora of complaints against these companies, the Federal Trade Commission (FTC) took action. Starting September 27, 2010, debt settlement companies face new restrictions. No longer will they be allowed to collect fees in advance, and they’ll be prohibited from making misleading and even false advertising claims.
Don’t fall for these scams. For real debt relief service, call a bankruptcy attorney such as The Law Offices of Truman Coe. We’re here to help.
Declaring Bankruptcy? You're In Good Company!
July 9, 2010
While you may think only “the average person” files for bankruptcy, you might be surprised to learn that many of the rich and/or famous have done the same. Celebrities from all walks of life have benefited from the protection and fresh start that bankruptcy can provide. The following are just a few you may recognize:
P.T. Barnum invested in the development of East Bridgeport, Connecticut and went bankrupt. However, just four years later he bounced back and became a partner in the famous Barnum & Bailey Circus.
Kim Basinger, the well-known actress, filed for bankruptcy in 1993 because she failed to keep her verbal commitment ot star in the film Boxing Helena. She had to sell her $20 million investment in Braselton, Georgia for $1 million just to pay the $8.1 million to Main Line Pictures. Later, she appealed the ruling, settled out of court and went on to star in such popular films as L.A. Confidential.
Lorraine Bracco starred as a psychiatrist in the HBO show,, The Sopranos. But before that lucky break, she filed for bankruptcy due to a five-year legal battle with Harvey Keitel over the custody of their daughter.
Benedict Arnold fought on the American side of the Revolutionary War, but switched to the British side. Later, a failed financial venture forced him into bankruptcy.
Walt Disney wasn’t always a success. In 1921, he started a company called the Laugh-O-Gram Corporation in Kansas City. Because his backers pulled out of the venture, he was forced to file for bankruptcy. It was obviously for the best, as the Disney name is now synonymous with children’s movies and animation.
Francis Ford Coppola directed the Godfather trilogy, which won five Academy Awards . But after his 1982 musical One From the Heart failed, he was forced into bankruptcy. He turned things around by starting a successful winery in Alexander Valley, CA.
Don Johnson, best known for his roll on the hit show Miami Vice, filed for bankruptcy in 2004 to save his $20 million Colorado ranch from being sold at auction. Not only did he save the ranch, he later paid off all his debts.
The above are just a few of numerous successful people who filed bankruptcy and started over.  So can you!
Good Reading:
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