Walk Away
From Debt

This book prepares you for either of these two goals:

    1. Walking away from some of your debt, and hanging on to a passable credit rating. This can make sense for people who depend on a credit rating to hold on to a good job, or need one to get business loans – or are hoping to buy a house at today's more affordable prices.

    2. Carrying out a total walkaway with as much cash in pocket as possible (and no lawsuits chasing you).

In goal #1 – since creditors nowadays are a lot more realistic – it can make sense to negotiate the creditors to settlements over a few months. This might be a cramdown on the value of a home, or a short payoff on credit cards (20 cents on the dollar is routine these days). You effectively walk away from a significant chunk of your debt with only minor-to-medium credit blemishes – and your credit score starts rebounding in a few months. (That's correct: months.)

In goal #2 – if credit score is less important than being financially solid right now, a total walkaway might make more sense: stop paying all creditors, live rent-free for up to two years in your home, if you have one, and then walk away with cash in pocket (people who do this usually regain good credit ratings much faster than those who struggle along for years with repayment plans).

Unlike the "one magic solution" books, Walk Away From Debt For a Better Future deals with the entire range of tactics, from do-it-yourself debt settlements for credit cards or bills, through home short sale or strategic default, to bankruptcy or asset protection.

It is written for both people who are starting to feel financially pinched, and people who are already in serious financial trouble. It is also for people who are comfortable right now, but are thinking ahead to a layoff or medical emergency, and thinking long-term about the kids' college education or their own retirement nest egg.

This guide always looks at (cheaper) non-legal alternatives first, and provides you with the practical and legal information you need to make your decisions and settlements, steering you around the scammers to legitimate information sources. The guide is applicable in all 50 states.

Though a great deal of research and analysis went into this book, the core of the book comes from what I learned when the dot-com bubble popped in the San Francisco Bay area in 2000-2002 and our jobs and our houses disappeared. Although I'd been a businessman and real estate investor, when that bubble burst I still had a lot of standard-wisdom misconceptions about what was important in financial survival. A lot of difficult problems like credit card debt turned out to be quite easy to solve. Impossible situations like looming foreclosure turned out to be difficult, but not impossible.

From what I learned then, and how I handled things differently when the Great Recession hit, one thing stands clear for most readers of this book: you will find that you have a lot more options than you realize.

I don't have any "upsells" to consulting packages or other books. This book tells you everything I know about successfully walking away from debt into a better future – probably with a lot more dignity than you expected.

                        – Nicholas Carroll

PS. It takes courage to walk away from debt. We wonder what our parents will think, what our friends will think. We imagine that our grandparents who lived through the Great Depression would disapprove. So we wait and waffle – for far too long, while our savings continue to drain down the high-interest or underwater home rathole. Guilt, embarrassment, and imaginary fears turn our feet to lead. I remember exactly what it was like. But ... I don't feel those emotions much anymore. Been there, done that – and my fears were grossly overblown. I drove a well-used car for a few years, but on the upside I had some money in the bank and the bills were gone. Readers tell me that my current much more relaxed attitude towards debt communicates through the book, and several readers have emailed me that they read straight through, sometimes twice in a row, and got the first good night's sleep in a long time. So while I started to write a how-to book, apparently the book is also a "why-to" – by the time you finish reading you know why "it's OK to walk." Remember, you're not running away ... you're walking away. There's a big difference.
        ( I've never encouraged anyone to stiff their family, friends, or local merchants; you pay them back when you can. This book is about dealing with debt to big business.)

What The Readers Say

"We DID walk away with cash in our pockets – and no deficiency judgment. So we still have a roof over our heads. Kudos!" – Joanne McKay, Sarasota, Florida

"I was dying on the vine, and then I realized I didn't have to." – Mary Patterson, Pacifica, California

"You've written a really, really good guide. Thank you. It lays out all the options in plain English." – David R. Smith, Sacramento, California

"I can't thank you enough for such wonderful, fast, and hassle-free service." – Albert W. Weggeman, Green Valley, Arizona

Our Guarantee
If you are not satisfied with the guide, you may return it for a full refund, no questions asked. If you lose the file – computer crash, whatever – anytime in the next year, we will replace it at no charge. (Our privacy policy is short: we don't sell information, and never have.)

Walk Away From Debt Table Of Contents
Published September 2010, updated September 15, 2012.

Will Walking Away Solve My Problems?

    Financial Comparison: the Gains From Partial and Total Walkaways

Real-Life Debt Situations and Solutions

Ten case studies of couples and singles in Arizona,
California, Florida, Illinois, Michigan, Nevada, and New York
who successfully did partial or total debt walkaways on:

    Underwater Homes and Balloon-Payment Mortgages

    Credit Card Debt

    Combinations of Too Much Mortgage and Credit Card Debt

    Major Medical Bills

    The Paycheck Advance Trap

The New Credit Rules

    The New Rules of Credit Reporting (including job hunting)

    Opinion On the Future Of Credit

The Rich Still Need Our Money • How important will FICO be?

    Fears, Legalities, and Realities of Collections and Credit

Tools For Walking Away

    Simple Walkaway

    Short Payoffs (homes, credit cards, medical bills)

    Short Sales

    Bankruptcy: Chapter 7 or 13? (They are very different animals.)

Step by step: how to simplify the decision on whether

to declare bankruptcy, and if so which type to use.

    Asset Protection (the other "nuclear weapon" besides bankruptcy)

    Avoiding Scammers and Ripoff Artists

Laying Out Your Personal Plan

    Step-by-Step Walkaway Plans

Includes Timing It To Walk Away From Most Or All Debt At the Same Time

    Steering Around Financial Fraud (while using the law to your benefit)

    Leveraging Your Remaining Credit

Mortgages and Home Foreclosure – Stop or Delay It

    Equity Sharing With Co-Investors (best with family or friends)

    Dealing With the Lender: re-fi, cramdown, short sale, or deed-in-lieu

    Challenging the Legality of the Loan

    Challenging the Ownership of the Note

    Strategic Default: Live Rent-free, then Move to a Rental

    Beware of Scam "Forensic" Loan Auditors/Companies

Credit Card Debt – the Easiest Walkaway of All

    Reduced monthly payments (usually the worst option)

    Reduced interest rate down to 10%-0%

    Short payoff at 20% of the total owing

    Or complete walkaway

Medical Bills: Discounts and Plans From Doctors and Hospitals

    Negotiating discounts (includes links to search fair prices by Zip code)

    Slow payment plans ($5-50 a month)

    Nullifying bills with credit card chargebacks

Dealing With Lawsuits

    Lawsuits Are Increasing (don't panic – but do read your mail!)

    Credit Card and Medical Bill Defenses

Dealing With Legal Judgments

    Protecting Liquid Assets (cash, 401k, etc.) and Physical Property

    Wage Garnishment – Who's Actually At Risk and What You Can Do

Wrapping Up Your Walkaway

    Do You Have Good Enough Credit to Rent? Probably "Yes!"

    Leaving Creditors Behind

    Moving Cash to New (safe) Bank Accounts

Rebuilding Your Financial Base

    Building Cash Reserves

    Diversifying Cash to Keep It Secure

    Reaching the Cash Comfort Zone

Credit Repair and Rebuilding

    The Six Solid Ways to Re-Establish Credit Quickly (in 2-4 years)

Resources

The Few Good Books • Useful Websites (government websites, legal information, and calculators).