My daughter went through a nasty divorce over a year ago...she got the house, and the debt as well. I didn't know how bad it was till Christmas but she used her credit cards to pay for too much and now is in over her head. We've helped her as much as we can but there's limits, and she brought up these credit/debt solution companies. I know nothing about them, have done some research and I'm not convinced she should go that route. Does anyone here have any info?? I don't want to steer her into something that will make things worse and from what I'm reading on reviews on some of these companies the results are a mixed bag.

Hawkeye, I'm still waiting for a callback from my friend ~ but take a look here for some good advice re what to look for and, more importantly, what to avoid ~ http://www.consumeraffairs.com/debt_cou ... eling.html ~

Sooz

I've actually learned alot about all this very recently. Sid's right in that bankruptcy works differently in the US than it does here in Canada, but if your daughter is in the position where her debts are larger than her assets, it does make sense. It isn't a life sentence, and can help get you back on your feet and in a position to start earning and saving again pretty quickly. In Canada anyway, any LIRA's or locked in pensions from employers are protected from bankruptcy and creditors, so it doesn't necessarily mean restarting from zero.

If she isn't in that position, then she can take a look at the position she is in. Does she own a home? Is her mortgage in arrears? If it is, banks are willing to renegotiate mortgages. Banks really don't like foreclosing--they aren't in the business of owning homes, and homes empty and full of junk don't sell well. They just want their money--if they think they're more likely to get it from you than foreclosing, they'll work with you. If there's equity in the house, then a private second mortgage could secure that a loan from family got repaid before any credit card companies, and get the arrears caught up at least long enough to get the house fixed up and sold properly.

Credit cards are another story. They are unsecured loans, and cannot attack assets without serving civil suit. The exeption to that is any credit cards held with the bank you have accounts with can make minimum payment withdrawls against your wishes straight from your account if you're behind (I know--this just happened to me. For instance--if you have a TD bank account and a TD visa in arrears.) But they can't lien a home without serving civil suit (at least here in Canada) and after that you've got about 3 weeks to respond. If the credit cards can see, by doing a credit report on your daughter, that she is deep in debt and in danger of going bankrupt, they are likely to deal for a partial payment and close the account. It's better than the nothing they'll get if you go belly up, or, frankly, the legal fees it would cost them to sue.

Credit counselling is something that's available through many employer counselling services, and counselling is just that--advice only. No commitments or payments to anyone. It might be a good place to start, if such a thing is available for her.

Tell her good luck.

Oh man GA...if she filed she might lose the house, wind-up making a nest in my family room and I'd never see my 50" Sony ever again (through all the bra's, undies, etc). I'm going to look into a CCCS and see if I can pick-up on a local one for her to go see. If they can leave her enough to live on that may be the way to go...thanks all.