It's ironic isn't it, that some of these debt settlement companies, that claim that they can keep you out of bankruptcy, end up filing for bankruptcy themselves? According to the Texas Attorney Generals' office, the Office of the Attorney General filed a lawsuit against the now bankrupt Debt Relief USA, a Dallas-area debt settlement company, on August 29, 2009.

Debt Relief USA has been out of business since 2009. A settlement has been proposed to the bankruptcy court that will refund over $4 million to consumers who had a balance in their savings account with Debt Relief USA. But most consumers will still lose money on the deal.

Folks, beware of signing up with these debt settlement or debt negotiation companies. First of all, many of them are operating illegally in the State of Texas. That's a bad sign! If they don't care if they are operating illegally, they won't care whether or not they steal your money. Or overcharge you. Or just vanish, as I have seen some of them do.

Many of these companies operate without registering with the State of Texas as they are required to do, they don't comply with the legal requirements, they don't post a bond to protect you, and they often charge far too much for their services.

However, there are some legitimate companies that have registered with the state and do comply with the law. A list of those services that are registered is on the web site of the Texas Consumer Credit Commissioner.

Or, if you have serious debt problems, or are facing a repossession, foreclosure, or IRS problems, you may want to consider consulting an attorney that is experienced in these matters. Attorneys are fiduciaries, which means that they are required to explain all of your options to you and act in your best interest. It may be best to know all of your options, including the options that you have to file Chapter 7 or Chapter 13 of the U.S. Bankruptcy Code.

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