A Review of Chapter 12 of Debt Cure$™ "They" Don't Want You to Know About.
If you've seen the infomercial for Kevin Trudeau's Debt Cure$™ book you're probably wondering what the "Two Magic Words" are. In the infomercial he claims that these Two Magic Words will clear up your credit almost overnight. If you're suspicious of such hyperbole, you should be.
First off, there aren't two magic words. There are eight of them. Or maybe six if you count an acronym as a word. So, right out of the proverbial starting gate, Mr. Trudeau has lied to you.
The first set of "magic" words are "Discharged Debt". How will using that with your creditor help clear your credit? Good question. But it only applies to those who (1) have declared bankruptcy, and (2) whose debts have been discharged by the court but not reported by the creditor to the credit agency.
Mr. Trudeau tells the story of one of his seemingly billions of friends, Dan Nolastname, who declared bankruptcy but never bothered to check his credit report after his debts were discharged by the court. the following year, he applied for a mortgage and, surprise, surprise, one of the debts hadn't been reported as discharged and was holding up the mortgage approval process. It seems to me that not checking your credit report (for free at www.annualcreditreport.com; do it now; I'll wait. ) after completing a bankruptcy proceeding would be about the smartest thing to do. And, who in their right mind would apply for such a big loan without first making sure the credit report was 100% accurate before hand?
"Dan Nolastname" paid the $9,500 debt he didn't owe just to get the mortgage going through. (He later sued the old creditor and got his $9,500 back as well as $14,000 in "fines and attorney fees".)
Regardless, this situation doesn't seem to me to be the fault of the creditor; it's Dan's fault for not making sure that all his discharged debt had been properly reported to the credit agencies. Due diligence, my friend; make sure there are no errors on your credit report. It's really that simple.
The second set of "magic" words is "Identity Theft".
Mr. Trudeau tells an unprovable story of yet another among his seemingly billions of friends, Kurt. Kurt apparently had a $15,000 debt being reported by American Express to the credit agencies. Kurt apparently didn't have - and never had - any American Express account. Kurt then told "Customer Service", after having lawyers allegedly send letters saying the debt wasn't his, that he "must be the victim of identity theft."
And, "poof!", according to Kevin Trudeau, the debt was removed from the credit report. He never comes out and says that you should claim that any legitimate debt on your credit report isn't yours because of identity theft but why else include this section if it isn't at least implied. In fact, he says,
"If there is something on your credit report that is a total mystery, you need to tell the credit card company or the bank that it is just not yours! Two magic words = identity theft. You should be able to get immediate improvement!"
No admonition to check for why it's a "total mystery"; he just tells you that if you don't recognize it, you must have been the victim of identity theft! This seems to me to be nothing more than a thinly veiled suggestion that you claim identity theft on any debts you don't want to pay.
The Statute of Limitations
And the third set of "magic" words is "The SOL". What? He means "The Statute of Limitations". Which careful readers will note is actually four words.
If the Statute of Limitations is up on a debt, it can't be collected. (The Statute of Limitations varies from 3 years to 15 years depending on the type of debt and the state in which the debt agreement was entered.)
He appears to advocate just ignoring your debt until it just goes away. He says to call the debt "alleged" and to never admit (or pay a tiny amount of it) to anybody who calls or writes about it. And, while legal, it certainly isn't ethical. If you signed a contract to pay for something, it's your obligation to pay it.
The only real and good advice in all of Chapter 12 is "Stay on top of your affairs and you can head off problems a lot quicker." Surely, you don't need a 300+ page book to tell you that. Save your money; or borrow the book from the library like I did.
In my opinion, the best way to "get rid" of your debt is to pay it off. It's your ethical obligation to do so. Bankruptcy should be only used when severe unforeseen circumstances arise (death of a wage earner, etc.) which severely limit your ability to pay the debt you owe off. Above all, you should not enter into a debt contract if you know you don't have the means to pay it; that's lying and is utterly, completely wrong.
For a review of the whole book, not just Chapter 12: Review of Kevin Trudeau's Debt Cures Book
Kevin Trudeau, in my opinion, offers absolutely nothing of value to anybody but himself. Ever. In anything he writes, says, does, thinks, or plans.
(While I'm not exactly sure what is trademarked (either "Debt Cures" or "Debt Cure$") it's owned by either Debt Cures, LLC (curiously, the copyright holder of the book) or Kevin Trudeau himself. Why set up an LLC? Well, it's a Limited Liability Company which, unless I'm wrong, means that the person or persons who set it up are not personally responsible for any of its debts or obligations. So, perhaps, another cure for your debt is to set up some sort of shell company, an LLC, and sink it into oblivion.)
On a related note: The FTC has banned Kevin Trudeau from Infomercials For Three Years, Ordered to Pay More Than $5 Million for False Claims About Weight-Loss Book.
September 14, 2010: On another related note: Judge Orders Kevin Trudeau to Pay More Than $37 Million for False Claims About Weight-Loss Book. Seems like Kevin can't keep his hands outta the cookie jar.