September 13th, 2012 by Questions
If you do not pay the creditors in the initial period wouldnt you get taken to a collection agency thus ruining your credit score in the future?
Posted from: Alberta
September 13, 2012 at 12:33 am, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:
You are correct. This is one of the biggest disadvantages to debt settlement programs, but one of the bigger problems is that not only can they continue to collect and ruin your credit, but the debt settlement program is not legally binding on your creditors so if a creditor chooses to opt out and sue you or garnish wages they have every right.
As a result I don’t regularly recommend most debt settlement programs. The better way to settle your debt is through a consumer proposal. There are a number of reasons, but one of the most important is that with a consumer proposal is that it comes with court protection that prevents your creditors from taking any action and it is legally binding on all your creditors so if you have the majority cooperate with the proposal it is legally binding on all your creditors.
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