The Debt Solution Founder Inteview

Read the Transcripts of Duane Anderson's interview (Founder of The Debt Solution) with CNBC below, or watch it by choosing the appropriate media link at the bottom of the image to the left.

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Bill Griffeth (CNBC analyst):

"The latest data released by the Administrative Office of US Courts shows that the number of new bankruptcy filings in the second quarter this year is up more than 24% over the same time last year. Our next guest says this rush to bankruptcy could be avoided if those who are in debt knew what the viable alternatives to bankruptcy are. Joining us from Burbank California with word on some of those alternatives is the founder of a company called The Debt Solution, Duane Anderson". Duane nice to see you, thank you for joining us".

Mr. Anderson:

"Well thank you, it's a pleasure to be here".

Bill Griffeth:

"You know it continues to increase. I was looking at some statistics you provided us. It was 1980 when there were 200,000 personal bankruptcy filings in the United States, 1990 saw over 600,000 and last year there were over 1.2 million. What's your version of why were seeing this increase?"

Mr. Anderson:

"Well I think that credit is really overly available to everybody and we have a very consumer oriented society that really lives off of credit. Most people "finance their lifestyle" on credit. It's very easy to get and people get overextended quite easily and I think that's the main reason we're seeing the increase".

Bill Griffeth:

"Plus there's not a great stigma to filing for bankruptcy like there used to be, right?"

Mr. Anderson:

"Well that's true, I think that the bankruptcy business out there would like to have people think there isn't much of a stigma there and you get a fresh start, but in my personal experience that's not necessarily so".

Bill Griffeth:

"And hasn't the federal government taken steps to try and tighten those regulations on bankruptcy?"

Mr. Anderson:

"Yes absolutely. In fact, my understanding is that the President is going to sign into law very soon, a measure that is going to really tighten things up and make it a lot tougher to do a bankruptcy which is going to make it a lot more difficult for many Americans who have bad debt situations."

Bill Griffeth:

"So they may want to look at some of these alternatives. What are we talking about?"

Mr. Anderson:

"Basically the most traditional thing is "debt management" or "Consumer Credit Counseling" type programs. That's where the Consumer Credit Counseling type company will basically consolidate the payment into one and give creditors lower interest rates. But that's all that they do really, and they're pre-arranged situations with the creditors. Bankruptcy has been an alternative as well as debt consolidation, which is really a loan usually with your property or home as equity for the loan to consolidate the debt.

Just recently in the last few years something called "debt negotiation", which is what we do, is available to people. We actually negotiate settlements on people's debt to reduce the interest and the principle substantially for "one-time pay offs" of the debt to help people get out of debt much easier".

Bill Griffeth:

"Where do people get the money traditionally for the one time payoff though?"

Mr. Anderson:

"Well our typical client would say they have $30,000 dollars worth of debt and need to come up with $700 dollars or so for a minimum payment but they only have $500 and it's not enough to keep current on the debt. What we do is use that $500 and have the client set aside that money every month and we use that to accumulate to pay off the debt and the settlement once the money's accumulated enough and that's traditionally how our clients get out of debt"

Bill Griffeth:

"Are we talking about traditional creditors, I mean are you talking about credit card companies, that kind of thing?"

Mr. Anderson:

"Yes".

Bill Griffeth:

"Are they open to that kind of negotiation?"

Mr. Anderson:

"Yes they are and we really try to screen the client so that we take on a specific niche and those are clients that really don't qualify for a CCC or Consumer Credit Counseling type program and would otherwise have to go into bankruptcy. For those types of clients the credit card companies are open to settlements at certain stages".

Bill Griffeth:

"I guess the alternative is they don't get paid at all then."

Mr. Anderson:

"Exactly, we did a survey of creditors just recently and 100% of them felt like negotiation was a far better choice as far as they're concerned than bankruptcy."

Bill Griffeth:

"Do you see a growth in this? I mean obviously you're in this business already so we know where your coming from but if we are going to see a tightening of laws pertaining to bankruptcies will we see other alternatives come forward like yours?"

Mr. Anderson:

"Yes I think there will be. There are more and more companies like ours springing up because it's a needed solution for people in this kind of a situation. So there are going to be more and more creative ways to try to help people out of this situation as things tighten up more and more."

Bill Griffeth:

"Duane, nice to see you. Thanks."

Mr. Anderson:

"Yes"

Bill Griffeth:

"Duane Anderson, the Founder of The Debt Solution joining us from Burbank, California."