North Carolina Department of Justice

North Carolina Department of Justice

North Carolina Department of Justice
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Resolve to pay off holiday debts this New Year


By Attorney General Roy Cooper

As holiday celebrations give way to New Year's resolutions, start off 2008 by resolving to get out of debt and stay that way.  
If you overspent during the holidays, the New Year is the perfect time to take charge of your finances. Here are some tips to help you get started:
  • First, figure out exactly what you owe to creditors.  Gather all of your monthly statements and look at your balances and when payments are due. 
  • If you’re overextended, stop using your credit cards and pay for your purchases with cash or check instead to keep from piling on more debt.   And remember to check your credit card interest rates. Paying a high rate can cause your debts to add up quickly.
  • If you aren’t able to set a budget and stick to it, or if you can't work out your own repayment plan, consider a credit counseling service.  Your creditors may be willing to accept reduced payments if you enter a debt repayment plan with a reputable organization. In these plans, you deposit money each month with the credit counseling service and your deposits are used to pay your creditors according to a payment schedule.
  • Avoid any debt management operation that asks you to pay large fees in advance. To find a non-profit consumer credit counseling service in your community, contact the National Foundation for Credit Counseling at 1-800-388-2227 or via their website at
  • Also, watch out for credit repair outfits that promise to fix credit reports for a fee. These scams cheat consumers out of hundreds of dollars and will do nothing to improve your credit. Under North Carolina law, it’s illegal to charge upfront fees for credit repair services.    
  • Avoid debt settlement companies that claim to be able to reduce your debts by fifty percent or more. These settlement schemes rarely work and will put you even further behind on your debts. Debt settlement companies typically charge large advance fees which are against North Carolina law.
  • Once you've taken steps to get your financial house in order, protect your credit by checking your credit report regularly. You can get a free credit report per year from each of the three credit reporting bureaus at If you see something that isn’t yours, you may be the victim of identity theft—meaning that someone pretending to be you has bought a car or taken out a credit card in your name.  
For more help and tips, visit my website at or call my Consumer Protection office at 1-877-5-NO-SCAM.
And here's another resolution to consider: when you shop in the year ahead, buy only what you can afford so you can start 2009 debt-free.

Attorney General Roy Cooper and his staff work from January through December to help North Carolina consumers make smart choices and avoid scams. We are here to be of service when you need us, but through education efforts like these columns we hope to help consumers avoid problems from the start.