Debt Archives - Page 3 of 6

Credit, Debt, Parachute Services, Uncategorized

Can I Negotiate Credit Card Debt?

Many of us have been there… our credit card debt is mounting. The increased interest rates aren’t helping matters, and we are starting to feel like we need a plan.

When you are first starting out on your path to become debt free, it can be very overwhelming. After internet searches, and reading some articles, you see that debt management and debt settlement come up often. But what is the difference and how do you know what is right for you?

Debt Management Plan (DMP)

Debt Management Plans (DMP) are typically offered by non-profit credit counseling agencies (like Parachute!) It’s a plan between you and the credit counseling agency designed to repay your unsecured debts in full within 5 years or less. The agency will negotiate with your creditors to lower your interest rates, lower monthly payments, and stop fees. One monthly deposit is made to the credit counseling agency, then your funds are distributed to your creditors every month. You don’t have to be behind on your debt to enroll, and since the companies offering DMPs are typically non-profit, the fees for service are low. You will review your finances, credit and goals with a certified credit counselor who can help you understand your options.

Debt Settlement

Debt Settlement is when your debt is settled for less than the full amount you currently owe, typically in one lump sum payment. You usually cannot settle your debts without being significantly past due, or in default. Any amount of debt forgiven over $600 is considered taxable income by the IRS. For example, if owe $8,000 on a debt, and the creditor agrees to a settlement amount of $5,000, you will owe taxes on the $3,000 forgiven by the creditor. You can negotiate a debt settlement yourself, but there are for-profit companies that you pay to hold your money to save up enough to settle the debt, and to help with negotiations. Fees can be high, and you risk further damaging your credit and lawsuits from creditors that are not willing to settle or wait until you’ve saved enough money to pay the settlement.

What is the difference between a DMP through a credit counseling agency and a Debt Settlement Company?

Credit Counseling Agencies that offer Debt Management Plans	Debt settlement companies
Usually non-profit organizations	Usually are for-profit companies that charge a fee for their services. Generally, these companies cannot charge you until after they perform services
Advise you on managing your money and debts and help you budget your payments	Offer to arrange settlements of your debts with creditors or debt collectors
Reach agreed upon payment plans or agreements with your creditors to ensure that the creditors will not pursue collection efforts or charge late fees while on the plan	Often have no up-front agreements with creditors. Some creditors will not negotiate with debt settlement companies
Usually do not negotiate any reduction in the amounts you owe – instead, they can lower your overall monthly payment	Typically offer to pay off your debts with a lump sum payment that you save up in an independent account that you control
Do not advise you to stop paying your debt, but may help negotiate your monthly payments	Usually advise that you stop paying your creditors until a debt settlement is negotiated with creditors, which may damage your credit and result in your being sued
Payment plans do not usually have tax implications	Debt settlement may involve debt forgiveness, which may have tax implications

As always, your financial situation is unique to YOU! There is no one-size-fits-all solution to resolve debt. In fact, these are only two options that we’ve highlighted here.

In order to start your debt free journey, we encourage you to speak one-on-one with a Certified Financial Counselor who will thoroughly review your income and expenses, explain your credit report and score, analyze your debts, and provide you with expert action steps to resolve your debt. Parachute is here to help! Contact us to start your debt free journey! 716-712-2060 or www.parachutecreditcounseling.org

Dare to be Debt Free!

Budget, Credit, Debt, Parachute Services, Uncategorized

Parachute Celebrates National Consumer Protection Week

Looking to protect yourself from fraud, identity theft, and scams? Wondering about the best way to improve your credit, shop for a used car, or how to maximize your security online?

Parachute has information for you during National Consumer Protection Week (NCPW) — March 5 – 11, 2023 — and any time of the year. NCPW is a time when government agencies, consumer protection groups, and organizations like ours work together to share information about consumer rights and help people learn to spot, report, and avoid scams.

Go to parachutecreditcounseling.org for more information. Also, visit ftc.gov/ncpw to learn how to get free consumer education materials and read the latest from consumer protection experts.

As always you can reach out to us directly at 716-712-2060 or www.parachutecreditcounseling.org for your help and education on all things credit, budget and personal debt!

Debt, Parachute Services, Relief Programs, Student Loans

While Long Awaited Student Loan Forgiveness is Blocked By Lawsuit, Parachute Credit Counseling Offers Encouragement and FREE Student Loan Counseling

While Long Awaited Student Loan Forgiveness is Blocked By Lawsuit, Parachute Credit Counseling Offers Encouragement and FREE Student Loan Counseling

The Supreme Court will hear arguments for and against this loan cancellation plan on February 28, 2023

The financial futures of nearly 43 million borrowers across the country are in limbo as the Supreme Court considers the legality of President Biden’s student debt forgiveness program.

President Biden’s student loan forgiveness plan, announced in 2022–which provides up to $20,000 in relief to millions of borrowers–faces legal challenges. While many Americans were happy with the new loan forgiveness plan, there is concern that without the root causes of the student debt crisis addressed, there will be no fundamental changes made to a system in great need of fixing. Most people on all sides of the issue agree that the present system is broken and will need legislation to fix it. Even without further and far reaching actions at this point, if allowed, student loan forgiveness will still make a big impact among borrowers who are low-income or didn’t finish college and are stuck paying off a loan.

Parachute Credit Counseling—formerly known as Consumer Credit Counseling Service of Buffalo (CCCS)—announced that it is now offering free Student Loan Counseling throughout the eight counties of Western New York along with expert strategies for attaining financial stability. Although payments on federal student loans have been suspended since March 2020, with interest-free relief, they will resume later this year so it is time for all to plan. Despite the current uncertainty, other relief options and changes to existing programs will be available to help borrowers reduce or eliminate their debt. Now is the time for borrowers to seek free and unbiased counseling to understand their options.

Parachute has operated the only Student Loan Counseling Program in Western New York for the past ten years. Right now, the national total student loan debt, including federal and private loans, sits at $1.75 trillion.

About 1 in 6 adults in America holds federal student loan debt. A typical undergraduate finishes school with nearly $25,000 of debt and a monthly payment of $460, which takes an average of 20 years to pay back while accruing $26,000 just in interest. Tuition fees have nearly tripled since 1980, outpacing inflation and wage growth. Student loan repayment is a critical issue that needs much direction.

The situation at this time is: millions of borrowers have already been approved for loan forgiveness, but the government is powerless to act because two federal courts issued nationwide injunctions prohibiting any debt relief under the plan. Most legal analysts expect the Supreme Court’s conservative supermajority to side against the administration, preventing the government from forgiving a cent of student loan debt. There is a real chance, however, that a majority may instead find that the plaintiffs—a group of red states and two disgruntled borrowers—lack standing to sue, which would allow the program to move forward. SHIRIN ALI, FEB 26, 2023—SLATE

While we wait for an answer…Parachute encourages residents to join our FREE Student Loan Counseling Program, staffed by experienced, certified financial counselors. Call 716-712-2060 or visit https://parachutecreditcounseling.org/ for more information on our program and other financial services we provide.

Credit, Debt

Is credit counseling a good idea?

Credit counseling involves meeting on-on-one with a certified credit counselor employed by a non-profit consumer credit counseling agency, and can be extremely beneficial if you are struggling with or overwhelmed by debt. Part of a credit counselor’s job is to help you evaluate your specific financial situation, and to offer personalized guidance on budgeting, credit, and debt repayment options. Some potential benefits of debt repayment through a credit counseling agency can include rebuilding your credit, reducing interest costs and monthly payment amounts, and having a concrete action plan to follow to work toward achieving your financial goals.

Credit counseling can be a great option if you:

Are struggling with monthly minimum payments for multiple unsecured accounts, and a reduced payment amount can be afforded within your budget
Have high interest rates and your creditors will not work with you directly to reduce them
Want to resolve your debt issues in a limited and fairly short term timeframe (5 years or less)
Are looking to understand how to better manage your finances
Need some additional guidance toward taking the best steps to achieve your financial goals
Are considering bankruptcy but want to discuss alternative options first

Debt repayment through credit counseling may NOT be the best option for you if:

Most of your debt is secured or otherwise ineligible – ex. student loans, mortgages, auto loans, home equity loans/lines of credit, etc.
Your debt amount is relatively small and can be paid off directly in a short period of time
You have the ability to make larger than minimum monthly payments
You still cannot afford household and living expenses even with a lower monthly debt payment

Whether or not you choose to repay your debt through a repayment plan with a consumer credit counseling agency, meeting with a credit counselor is a great recommendation for anyone struggling with debt, because an expert can take a look at the entire financial situation and help come up with an action plan on how to move forward. Many credit counseling services, including initial consultations, are free, so there is no harm in at least hearing what a certified credit expert may recommend. Do your research, and remember that there are no quick fixes or shortcuts when it comes to your finances. It’s a process, but one that can really be worth it!

Credit, Debt, Parachute Services, Uncategorized

Consumer Credit Counseling Service of Buffalo is Now Parachute Credit Counseling

Parachute Credit Counseling provides services to help clients “dare to be debt free”

BUFFALO, NY (December 7, 2022) – Consumer Credit Counseling Service of Buffalo announced it has changed its name to Parachute Credit Counseling to illustrate the agency’s commitment toward being a guide on their client’s journey to “dare to be debt free.” Clients will still get the same quality service they have relied on for more than 50 years, but now with a new look.

“We wanted to change our name and logo to reflect our mission of making our clients feel empowered and not embarrassed about their debt,” said Parachute President & CEO Noelle Carter. “It takes courage to make that leap and we are here to be a parachute – a guide – on the journey to financial stability and becoming debt free.”

Parachute Credit Counseling mission is to be the most trusted guide on an individual’s journey to becoming debt free. With the right tools and a strategically mapped out plan, clients can make a smooth soft landing on the other side of debt.

Parachute Credit Counseling is a nonprofit agency offering financial counseling, debt management, student loan counseling, financial coaching, credit report review, reverse mortgage counseling, pre-purchase homebuyer counseling, delinquency housing counseling, and small business credit counseling. The agency offers services in 18 states and the District of Columbia.

For more information about upcoming workshops and the services Parachute offers, visit the website at (insert new website here) or call 716-712-2060 to set up an appointment at any of the locations.

ABOUT PARACHUTE Parachute Credit Counseling, formerly, Consumer Credit Counseling Service of Buffalo, Inc. is a nonprofit agency established in 1965 to provide the best strategies to help people master their credit. Parachute is a member of the of the National Foundation for Credit Counseling and an A+ member of the Better Business Bureau. It is also a certified HUD counseling agency, licensed budget planner through the NYS Department of Financial Services, Executive Office of the U.S. Trustees approved for certified bankruptcy counseling sessions and accredited by Council on Accreditation of Services for Families & Children (COA), Inc. Parachute is based in Buffalo, NY, but offers services in Arkansas, Alaska, District of Columbia, Florida, Georgia, Hawaii, Illinois, Louisiana, Massachusetts, New Mexico, New York, North Carolina, Ohio, Oklahoma, South Dakota, Tennessee, West Virginia, Washington, & Wyoming.

Debt, Parachute Services, Student Loans

CCCS Launches New, FREE Student Loan Counseling Program; Joins the Education Debt Consumer Assistance Program (EDCAP) Network

CCCS Launches New, FREE Student Loan Counseling Program; Joins the Education Debt Consumer Assistance Program (EDCAP) Network

Will Help Local Borrowers Access Loan Forgiveness & Navigate Complex Student Loan Repayment System

Shortly after the federal government kicked off their student loan forgiveness application process, Consumer Credit Counseling Service (CCCS) announced their newly redesigned, cost free Student Loan Counseling Program to assist local borrowers. While the government’s process is meant to be simple, the complexities of student loans often cause uncertainty, anxiety and frustration.

For the past ten years, CCCS has operated the only Student Loan Counseling Program in Western New York, helping thousands of besieged borrowers tackle what many felt was insurmountable debt. Student loan repayment has long been an obstacle for a significant percentage of the population, particularly for younger people. 45% of 18-35 year olds currently have student loan debt in New York State. Right now, 2.4 million New York State residents have outstanding loans; a total cumulative debt of over $90 billion.

In October, the Education Debt Consumer Assistance Program (EDCAP) invited CCCS to join their statewide network after the New York State Legislature increased their funding specifically designated for New York State residents with higher education debt. EDCAP–a program of the Community Service Society of New York (CSS)—and CSS work to make New York State more livable for people facing economic insecurity. CSS created EDCAP as an initiative to help New Yorkers struggling with student debt to navigate the student loan repayment system and regain financial health. In addition to CCCS, EDCAP selected nine other partner organizations throughout the state to serve all of its geographic areas. Seven of these organizations focus on legal services and the other organization is a United Way, indicating that CCCS offers unique and highly regarded services.

CCCS’ collaboration with EDCAP provides CCCS with much needed funding to deliver all student loan counseling services free of charge to WNY residents. EDCAP, in turn, gets a greater and more direct geographic reach into a targeted area. The NYS Department of Financial Services will oversee this project which comes at “a critical time as borrowers navigate the complex student loan repayment system, try to benefit from the latest relief available, and prepare for payment resumption.” EDCAP

A slew of information—including announcements of major, sweeping, long awaited changes to student loan forgiveness that require specific, precise action steps–has steadily flowed recently. We designed our Student Loan Counseling Program to guide borrowers through the complicated process that is frequently intricate and quite possibly thorny. Experienced, Certified Financial Counselors understand that many of those coming for help feel overwhelmed, are confused or just plain over it…and are ready to help all. Our new partnership with EDCAP will allow us to serve even more people. We urge everyone to take positive action that will promote financial stability…Contact us at 716-712-2060 or www.consumercreditbuffalo.org for help with student loans or for any type of financial issues.