When It’s OK To Do Nothing

In our fast-paced Western culture of go-go-go and do-do-do it’s tempting to think that all problems can be solved by being proactive and *taking action*. However, that’s not always the case, especially when dealing with financial problems.

As the saying goes, “You can’t squeeze blood from a turnip.” And with regard to creditors, they can’t take what you don’t have. Therefore, there are some unique situations where sitting idle and *doing nothing* (at least in the short term) might be the way to go.

Here are two examples …

Example #1:

Let’s say you’re presently unemployed and you have few or no assets to your name. Thus, there’s no wage for a creditor to garnish and there’s no car or property for them to seize. A creditor could huff and puff and do their best to intimidate you, but if you find yourself in a situation like this there’s not a whole lot that a creditor could do to you to really hurt you financially.

Example # 2:

Let’s say you’re retired and your only source of income is a pension or social security check. In most cases, this type of income is off limits to creditors. But what if you’re a homeowner? Ok, fine. A creditor could sue you and get a judgment against you, then they could attach a lien to your house. But they won’t get any money from you unless you sell your home. So if you don’t plan on moving any time soon, that lien could sit there for *years* before the creditor collects a dime.

The concept we’re talking about here is being “judgment-proof”. Yes, it takes some intestinal fortitude, but ultimately your creditors can only do so much if there’s nothing there (financially) for them to go after.

Now please don’t take this the wrong way. I’m not suggesting that you deliberately do things to try and screw your creditors out of the money that you rightfully owe them. Not at all.

But what I am saying is that if you’re going through a rough patch financially, there are some unique situations where you’ll temporarily be just fine by *doing nothing*, and it won’t cost you a dime. Certainly you are going to want to straighten things out eventually. But sometimes the best course of action in the immediate moment is simply to sit tight, remain calm and do nothing.

Naturally if you are *working* and/or you have some *assets* that creditors could go after, that’s a different story. In other words, if you are gainfully employed or you have assets that could be at risk you might need to actively pursue a solution to your present financial dilemma while you still have the opportunity to do so. (Translation: Don’t become a sitting target for your creditors.)

In most cases you will need to be proactive and take action to solve any financial challenges you are faced with. However, as described above, there are some unique situations where you’ll be just fine by doing nothing.

The Effect Of Difficult Economic Times And Its Impact On Debt Settlement

During the past couple weeks, numerous people (both clients and colleagues) have posed the following question to me:

With the U.S. and global financial markets presently experiencing a lot of stress and turmoil, how do you think that’s going to affect credit card companies’ willingness to settle for less than full balance on delinquent accounts? 

At first glance you might be tempted to say, “Gee, in difficult economic times with so many people struggling financially and unable to pay their bills, credit card companies would probably be very eager to accept just about anything they could collect.” However, my experience actually suggests just the opposite.

What I’m saying is that when we are in a challenging or recessed economy, it is common for large financial institutions to actually be less willing to write off a substantial portion of the debt that you might owe just because profit margins aren’t what they used to be (when the economy was booming).  In other words, when profit margins are down they just can’t be as generous in writing off large amounts of debt.

Now that’s not to say that you still can’t obtain settlements for less than full balance on delinquent accounts when we’re in a tough economy. Quite the contrary. It’s just that you might have to work a little harder because creditors might put up more resistance than usual because their coffers are not as full and there’s less margin for error. When the economy rebounds, it’ll more than likely return to business as usual.

Just my opinion and observation after working in this industry for over 12 years.

The # 1 Reason Why People Wish To Avoid Bankruptcy … The Answer Might Surprise You

Since 1995 I’ve done several thousand one-on-one phone consultations with people in all stages of financial distress, many of whom were desperately attempting to resolve their financial challenges without resorting to bankruptcy.

What do you think is the # 1 reason why people wish to avoid filing bankruptcy? Do you think it’s because bankruptcy would …

If you guessed any of these you would be wrong. Without a doubt, the # 1 reason why people wish to avoid filing bankruptcy is because they acknowledge that they owe the money and they want to (attempt to) pay it back.

Whether it’s because of their religious beliefs or just their personal moral convictions, the vast majority of people that I’ve spoken with over the years acknowledge that they owe the money and feel very badly about their inability to pay it back as originally intended. In other words, even though they now find themselves in a difficult financial predicament they still want to do the right thing and pay back what they can, even it’s for less than full balance.

I mentioned this to my wife the other day, and even she was genuinely surprised that this was the # 1 reason. But it’s the God’s honest truth.

Sure, there are the so-called “professional deadbeats” and scam artists that don’t pay their bills, but these people are the small minority. My experience has been that the overwhelming majority of people in difficult financial situations are good, honest people that acknowledge their financial obligations. But because of certain events that have transpired in their lives it might be extremely difficult, if not mathematically impossible, for them to repay their debts.

What exactly is a debt settlement “program”?

A lot of people want to know about debt settlement “programs”. If you’d like to hear my response, please listen below:


(press play)

To hear more explanations and commentary from Mark Brinker, please click here 

How To Negotiate Settlements On Credit Card Debt (It Ain’t Sexy, But It’s Got Teeth)

For the past 12 years I’ve made my living as a professional negotiator. Specifically, I’ve assisted normal, everyday people (i.e. consumers and small business owners) in helping them avoid a possible bankruptcy filing by negotiating settlements with their creditors for less than full balance. Most of the settlements have been for $0.50 on the dollar or less.

Looking back, there really was no manual or playbook that taught me how to negotiate. I pretty much just figured it out on my own through thousands of trials and errors.

Want to know my secrets? Ok, no problem. Here they are. For real.

What follows are the six critical elements of my negotiating style that have helped to settle millions of dollars of debt with all the major credit card companies, collection agencies and attorneys. These elements are field-tested and they work. 

  1. Define Your Outcome. Seems obvious, but before you do anything you need to know what it is that you want. What settlement amount(s) would you be satisfied with? Don’t just say, “I want the lowest settlement possible.” That’s wimpy and vague. Be direct and say something like, “If I could settle this $20,000 account for $12,000 or less I would be satisfied and that would give me the financial breathing room that I need.” Also, what’s your timeframe? Do you have a deadline of finalizing everything within 30 days or are you prepared to take your chances and wait for the right situation to (hopefully) materialize. I’m not saying that you don’t have to be flexible as you proceed, because you do. No one that I know of can predict the future with 100% accuracy, but you at least have to be open to revising your initial objectives if conditions change. But in order to get things started you do need a tangible target to give you something to shoot for. Otherwise you’ll simply wander aimlessly and never really know if/when you’ve achieved your outcome.

  2. Assess The Situation. It’s one thing to define your outcome and be optimistic, but it’s another thing to accept the statistical likelihood of your outcome actually materializing. For instance, I’ve had people want to hire me to settle their outstanding debts for $0.20 on the dollar, and not a penny more. My response to them? “Keep on truckin’, Bubba. I’m not your guy.” While it’s true that we have settled debt for extremely low amounts like that, it doesn’t happen every day and I’m certainly not going to take on a client with such rigid demands right out of the gate. So after you’ve decided what it is that you think you want, you might want to get an opinion from a trusted source to assess your situation and give you their opinion on what the probability of achieving your outcome is.

  3. Research, Research, Research. Now it’s time to formulate your plan of attack. But before you start doing a bunch of “stuff” just for the sake of taking action and being “proactive”, I would strongly suggest that you attempt to learn as much as possible about your opponent before proceeding. Kind of like doing a scouting report. What are their strengths? What are their weaknesses? What are their tendencies? What type of results have you achieved with them in the past 6 months? Do you have a specific contact within that company that you’ve worked with successfully in the past? Is there a specific departement within the company that is more favorable to work with than others? If you’re not familiar with the company you’re going to be dealing with, is there any useful information about them on the Internet? Why do you think professional sports teams have people on their payroll just to scout their opponents? Because it’s that important.

  4. Use The Correct Tactical Maneuvers. Should you attempt to negotiate a settlement over the phone or should you submit proposals in writing? Or a combination of the two? If you’re going to submit a proposal in writing do you fax it to them, mail it to them or send it FedEx? Depending on the situation you might need to use all of these methods? Regardless of whether the situation calls for written or verbal communication, what exactly do you say? This aspect really hits home when you’re sitting at your desk with a blank piece of paper in front of you. And what if they agree to settle? Now what? You need to make sure you take the necessary steps to insure that the settlement agreement is permanent and final so this matter can’t come back and bite you at some point in the future.

  5. You’ve Got To Have The Right Personality. A lot of people in this world talk a good game, but talk is cheap. I’ve had clients pee their pants when confronted with an aggressive bill collector. Money can be a very volatile and emotional issue, so you have to have the right temperment to do this type of work. You and only you know whether you’re up to the task. If you’re not, just accept it and get help. It’s not a sign of weakness and it’s nothing to be ashamed of.

  6. Trust Your Intuition. This is probably the one element that separates the men from the boys. Call it your gut feeling, your sixth sense … call it what you want. But tapping into the world of subtle energies and expanded awareness has been my # 1 secret weapon for seeing opportunites and avoiding danger, not just in my negotiations with credit card companies and collection agencies but in life. If you listen closely, your intuition will tell you when to take action and when to stand still. Your intuition can give you an enormous amount of insight into your opponent and what their next move might be. Some people have developed their sixth sense to communicate with the dead. But for me, I use it to help people solve their financial problems.   :-)

Now obviously there’s tons more we could talk about regarding the subject of how to negotiate settlements on credit card debt, however that’s beyond the scope of the this article. But at least you now know the six key elements that I use to this day to do what I do. (And I’m pretty good at what I do!)

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