Question: Monica has $300 in very old credit card debt. However, now the bill is $1,500 because of fees and charges. Is she liable for that?

Dave Ramsey's advice: Every month you're late or over the limit, there is a charge. Legally, they can hold you to that. If they haven't received payment in a while, you can probably settle this for $500. Don't give them any money until you get it in writing what they will settle the debt for. Don't give them electronic access to your checking account. Once you have it in writing, staple a copy of your cashier's check to that letter and keep it for the rest of your life, because it will come up again.

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Question: Jason works for a big bank in the customer service department. The bank wants him to start selling credit cards to everyone who calls in. He doesn't feel right about doing this, and was given an ultimatum to quit, be fired or sell the cards. What should he do?

Dave Ramsey's advice: I think you need to look for a job. The problem is that legitimately, what they are asking you to do is not illegal, but you can't do it in good conscious. When your employer tells you to do something and you can't in good conscious do it, you need to work elsewhere. You've got to be true to your own value system in your career path. You're not doing anything illegal and you don't need to storm out of there, but stay off the radar and start to look for another job. Banks like this have lost their moral compass.

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Question: Renee has $29,000 in credit card debt. She enrolled in a debt settlement program, which told her they can bring that total down to $14,000. She is paying them $430 a month and has paid a total of $3,000. Her husband brings home $50,000 and they have 4 kids. Dave explains to her that she can do much better than this company is in settling the debt.

Dave Ramsey's advice: One of the top areas of financial things that are complained about to the Federal Trade Commission as being a scam is debt settlement companies. They are hugely unethical. There are legit ones, but as a group, they are bad. All their fees come up front. You'll pay them thousands in fees before they do anything. They've told you not to pay your bills and that totally destroys your credit. The credit card companies will settle with someone who is months late because they think they won't get paid.

The problem has been that they collect their fees up front, and then go along like that, and they won't return your calls. They don't put forth the effort that you will in settling your debt. You've paid $3,000 and that would go a long way in settling your $29,000 in debt.

Get out of the program and do this yourself. Pile up as much cash as you can to attack your first credit card before you call them and settle. They usually settle with something that old for 25 cents to 50 cents on the dollar. Get a settlement offer in writing and don't give them electronic access to your checking account. If you get sued, don't ignore a lawsuit. Your odds of being sued if you are talking to them and working with them is very low.

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