Can't read the fine print in a radio commercial!

Much to the dismay of my peers, I've already turned into one of those 'old men' who listen to nothing but talk radio. I guess the demographic of which much talk radio is aimed consists of "middle-aged adults with over $10K in credit card debt", if the commercials are any indication. John Commuta and his "transforming debt into wealth system" as well as the "you have the right to settle your debt for a fraction of what you owe"-people permeate the airwaves, it seems.

Well if you have an ounce of common sense, most of these ads just go in one ear and out the other. Debt will always be debt, and the only way to 'transform' it into wealth is by paying it off and investing smartly. And yes, in some cases your creditors will accept a less than 100% payoff and call the deal 'done', but there's always a catch; usually in the form of a "account settled" mark on your credit report(s) in lieu of "paid as agreed".

Anyway - I was watching some early AM cable TV the other day (which is often nothing but informercials), and came across a TV spot for the same company I'd heard on the radio, claiming to "settle your debt" for pennies on the dollar. What caught my attention is the legalese at the end, in the form of a nearly 4pt font at the bottom of the screen. Being the Curious George, I paused the DVR and actually read it (the radio spots don't have this verbiage).

AH HA! It appears this company doesn't really do anything at all except collect your personal information and sell it to other "credit management" agencies, which may or may not be able to help you settle your debt. Oh and another thing they don't mention, most of the "settle your debt" firms will have you just STOP paying on your credit cards completely! They instruct you to save up the money you would have paid them, until you have enough to make a lump-sum payment needed to 'settle' your debt; but only after the creditor reaches the point of accepting whatever they can get out of you.

See, the credit card companies will likely NOT to accept an offer to settle if you've been making regular payments - but once your account falls into arrears (usually for many months, if not years!) they *may* accept a lump-sum payment for less than the full amount and call it even. Oh by the way, during that time you're not making payments, you'll be hounded by the creditor, and usually a 3rd party collection agency or two. If you owe enough, they may even sue (and win) and garnish your wages.

Having said that - there are probably a few companies out there that can help you out, if you're in need of such services. Caveat emptor! Do your own research.

But enough of those messy details - my whole point was - when you hear the radio spot, heck, it may sound like a good deal! Apparently the disclosure of what they ACTUALLY do is only required for the TV advertisements? Something doesn't seem right to me if that's the case. In these trying economic times, consumers are more vulnerable to possible rip-offs. Be smart!