If It Seems Too Good to Be True....
It's no surprise by now that college and law students graduate with debt - lots of it. And it's no surprise by now that many of those students can't even get a job to try to pay off that debt.
Enter the "vultures." Debt settlement companies have found their mark, and they are swooping in for the kill. But there is a way to effectively evade these birds of prey and not die financially in the process.
The Illinois attorney general filed lawsuits against two debt settlement companies, claiming that they were guilty of fraud for taking money to renegotiate payments, among other services, none of which they are licensed to perform.
A New York Times article "Companies That Help with Student Loans Are Often Predatory, Officials Say" by Rachel Abrams and Jessica Silver-Greenberg, the mortgage crisis spawned debt resettlement companies, which now focus their sights on students in debt.
According to "Illinois AG Sues Student Loan Debt Settlement Firms," an article by Becky Yerak for the Chicago Tribune, the debt resettlement companies charged up to $1,200 for services that a person in debt could access for free from the federal government via the Consumer Financial Protection Bureau and the National Consumer Law Center.
It is often financially savvy to hire a business to do a service, freeing you as a lawyer to focus on doing what you do best - lawyering. However, having said that, good business practices entail a thorough investigation of service charges. The charges should be fair and reasonable, and the service should be worthwhile. In terms of debt resettlement, there is no reason to pay a fee when you can access free help. Your money will be better spent building up your law business, through which you can make more money to pay off those student loans.
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