Digging Out of Debt, By Not Paying the Bills
A Guilford company is helping a North Branford couple recover from financial woes
By BRAD DRAZEN
Updated 9:45 AM EST, Thu, Nov 5, 2009
The old 1920s standard "Nobody knows you when You're Down and Out" is Dave and Kim Fry's theme song these days.
Dave, a traveling folk musician, and Kim, an ordained minister, had always taken pride in being fiscally responsible. The couple from North Branford typically carried a few thousand dollars in credit card debt, but always paid it off.
About three years ago, they took a risk. Kim decided to buy an older house in Madison, with an eye toward rehabbing it, then selling it, to grow their savings account.
"It took longer than I thought. It was much more expensive than I thought, and then the real estate market tanked," she said.
The couple maxed out their credit cards to pay for the upgrades and ultimately sold the place for what they'd paid for it. In the meantime, they struggled to keep their heads above water.
"I just remember that one day I was looking at the bills and saying, 'Oh my gosh, I'm not going to be able to keep doing this.'" she recalls.
The Frys downsized, but in a matter of months the collection agencies were calling constantly and they were buried in debt. They owed more than a $100,000 on half a dozen different cards.
They considered bankruptcy, but instead decided to follow the advice of a local credit counselor who has quite an nontraditional approach.
Scott Wilson, of Debt Elimination Services in Guilford, says his primary focus is to educate people about their consumer rights. He's met dozens of people in the same predicament as the Frys.
"The reality is that there are really not a lot of good choices for people who've found themselves in this spot. For some people, paying back the debt is a viable strategy,. For many people, what we quickly learn is that they can't," Wilson said.
In those cases, Wilson advises his clients to simply stop paying off their credit card debt. The statute of limitations in Connecticut to file a suit on a debt is six years from the date of the last payment.
NBC Connecticut checked up on Debt Elimination Services and found the Attorney General's office has no file on the company and the Better Business Bureau has no pending complaints and gives it an "A" rating.
The Frys agreed to pay Wilson $5,000 in monthly installments. In exchange, he's looking for any violations of their consumer rights to get get the debt collection stopped. He also placed the couple on a cash-only budget and helped them set priorities for their spending, placing personal expenses and housing before the unsecured credit card debt.
These days, the Frys have a fresh perspective on money. They know their credit rating will be rock bottom for several years, but say they've come to value the new found simplicity of their lives.
"You lower your expectations and you become comfortable with knowing this is where you are right now. As long as I'm working and can be happy and the family's together that's great," Dave said.
Only time will tell what kind of financial tune they'll be singing a few years from now.
First Published: Nov 4, 2009 10:47 AM EST
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