The Georgia Governor’s Office of Consumer Protection, a very official sounding name, has its own website that warns consumers to beware of certain debt elimination scams… and each one they list is exactly that — a scam to be avoided. They list scams that require $2500 up front fees that provide official looking Certificates to present to your bank; second mortgage scams that sound a lot like debt consolidation; and scams that question the authority of the Federal Reserve System. They’re right. They are all scams. And they left out a few, most principally: bankruptcy.
Could we be right in calling “bankruptcy” a scam? Let’s look at it. First, isn’t it just a product that lawyers sell? Aren’t the courts rigged to set up their “friends” to push the product? The Governor’s task force says some company asking a $2500 up-front fee is a scam yet that is the average fee a lawyer charges for filing bankruptcy. And they must be paid in advance or their client would include the fee in their bankruptcy filing.
There are two bankruptcy types: 7 and 13. If you “qualify” for Chapter 7, you will probably lose your house. If you qualify for Chapter 13, guess what? You’ll be bankrupt and still have to pay back your debts. Not such a great product, is it?
The Office of Consumer Protection goes on to warn you to beware of any plan that lowers your credit score because your future interest rates will be higher. And that’s true. But wait, you file bankruptcy and what happens to your credit score?
Bankruptcy is a scam, isn’t it?