I bet you didn’t know there is a government sponsored debt consolidation plan in Eagan, Minnesota? Okay, actually, there is a government sponsored plan across the entire state of Minnesota! Why have most people not heard about this plan? Most people are familiar with debt consolidation companies out of state, many of whom are owned or linked to major credit card companies. But, did you know the government has its own debt consolidation plan for people like you and me?
It’s true and in this blog we will cover some of the major characteristics of this plan. How does it work? What do you have to pay? For how long? Etc.
GOVERNMENT SPONSORED DEBT CONSOLIDATION PLAN LENGTH
The government plan cannot be longer than 5 years and cannot be shorter than 3 years. Literally, this means than you can never have a 61 month plan and you can never have a 35 month plan (unless it’s a pay in full plan).
So, if you live in Eagan, Minnesota, and you suffer from overwhelming debt, if you were in this government plan, you know the pain of repayment would not last beyond 60 payments. Knowing that a debt problem can be contained within 60 month plan payments is relief in and of itself.
ARE MY ASSETS PROTECTED IN THIS PLAN?
Yes, your assets are protected from your creditors in this plan. You retain possession and ownership of all your assets and no creditor can seize your assets and liquidate them to pay your debts. Sound too good to be true? It’s not, this plan has been in existence for almost 200 years.
Many of our guests worry about losing assets they know they would lose to a chapter 7 trustee in bankruptcy. Not true in this plan. No trustee or creditor can seize any of your assets. That is a huge relief to most of our guests.
HOW MUCH DO I HAVE TO PAY BACK TO MY CREDITORS?
Let’s pretend you have 50k in credit card debt and if your wages were being garnished by one of your creditors they would take $800.00 a month from you. You say, after this creditor takes $800.00 from you, you are left with not enough to cover your reasonable and necessary expenses.
This example is a frequent example of what really happens out there in the real world. It also illustrates why traditional (non government sponsored debt consolidation plans do not work). That’s because in a traditional debt consolidation plan, creditors are not barred from trying to collect from you while you are in the plan. If they don’t like how much they are receiving from you in the traditional debt consolidation plan, they will just garnish your wages and take $800.00 a month from you, leaving you unable to pay your bills and making the non government debt consolidation plan fail.
My point is this- in non government debt consolidation plans, creditors eat first, you and your family eat second. That is not a great formula for succeeding at debt consolidation.
In the government sponsored plan, your payment back to your creditors is based on your budget that is determined by you and our office!! Basically, you must pay your creditors your disposable income for 3-5 years. Disposable income means the amount you have left over after your reasonable and necessary expenses get paid first! You and your family eat first and your creditors eat second!
If what you can really afford to pay is $200.00 a month then that is your payment for say 36 months. You say, wait a minute, $200.00 a month for 36 months comes to $7,200.00? But, my debt is 50k, you say? The beauty of this government debt consolidation plan is you typically are not required to pay everyone in full (unless you have a lot of assets!).
If what you own is usually something that can be protected anyway from your creditors, like your house, car, pension, clothing and furnishings etc., than all you are required to do is to pay your creditors your disposable income for the period of the plan. WOW! That is incredible! But, then you say, what happens to the $42,800.00 that does not get paid off? What happens is the $42,800.00 gets wiped out, forever, tax free!! Drop the mic........
PLUS, WHILE IN THE GOVERNMENT PLAN CREDITORS ARE BARRED FROM COLLECTING FROM YOU!
To add to the excitement, while in the plan, creditors are barred from sending you bills, calling you, garnishing you, suing you, doing anything to collect on their debt with you.
Incredible? We think so.
WHY DO PEOPLE NOT KNOW MORE ABOUT THIS PLAN?
In a word- stigma. Yes, I said stigma. Most people cannot get past what we call this government sponsored debt consolidation plan. They call this debt consolidation plan a Chapter 13 Bankruptcy. If, instead, they called it what it really is, a government sponsored debt consolidation plan, more people would choose to do it rather than waste their time doing traditional debt consolidation.
I know it’s sometimes hard to get past the “stigma” of a word. And it is just a word. But, once you get past the silliness of just a word, we have never had a single person regret doing this government sponsored debt consolidation plan but they always have one regret- they regret waiting so long to have filed it. Because until you do, you are not on the road to getting your life back! I feel terrible for anyone suffering through overwhelming debt who are stuck in these traditional, high paying, debt consolidation plans that ruin your credit and often end in disappointment and regret. Don’t have disappointment and regret. Once you are beyond the stigma of a single word, life is beautiful, in control, and you can pay your family’s bills again, on time. In short you have security and safety.
CONCLUSION
Have you ever been afraid to do something and when you did do it, you said, hey that wasn’t so scary after all? We all have. Sometimes the things that scare us are really silly and we spend years avoiding them because they were “scary.” And yet, when you did them you wished you hadn’t avoided it for all these years!
Sometimes, the things that scare us are really, really silly- like a single word in the dictionary. How can a single word be so silly and scary and yet its meaning be so absolutely wonderful!? Life is humbling indeed. When the time is right, or when you are ready, reach out us as Kain & Scott by calling 800-551-3292 or seeing us on line anytime at Minnesota’s 24/7 Bankruptcy Helpline at www.kainscott.com.
