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The San Gabriel Valley comprises most of the area long-known as East Los Angeles. While the stereotype of the area is that of a lower middle class Hispanic enclave, today’s San Gabriel Valley is home to one of the most diverse, thriving economies in the world and has one of the most varied demographics of any major metropolitan area in the United States.

Extending from the San Gabriel Mountains to the Port of Los Angeles in the south, the San Gabriel Valley encompasses a large part of Los Angeles and much of its most economically vital core. The Port of Los Angeles itself is the largest of its kind of North America and fuels vast industry. The San Gabriel Valley has more manufacturing jobs than anywhere else in the United States. And unlike its Rust Belt counterparts, the Greater Los Angeles manufacturing sector has only grown over the last decades.

The area also has traditionally been home to many different firms in technology and aerospace. It is still home to Jet Propulsion Laboratories, one of the government’s premier research facilities, as well as outposts of Lockheed Martin and many others.

The area is also known for tourism, with one of the nicest climates anywhere in the country. Disneyland is located at its southern tip.

But despite a thriving economy, the San Gabriel Valley has its share of economic woes. Its official unemployment rate is 7.5 percent, two percent higher than that of the state of California as a whole. And the area suffers from some of the worst wealth inequality of any metro area in the country. The average cost of a single family home in the San Gabriel Valley is an incredible $611,000. That means that almost no one, short of being a millionaire, can afford to purchase their own home.

But even that doesn’t tell the whole story. Many areas have actually experienced housing price declines. Driven by white flight, neighborhoods that used to be solidly middle class have now become crime-ridden ghettos. Even areas like Compton, which once was home to many middle-class blacks, have seen a generally downward trajectory. Those stuck owning homes in these locations have seen their net worth evaporate before their eyes. On top of this, many San Gabriel residents were forced to sell or foreclosed on during the housing crisis. Such facts paint a stark picture for hundreds of thousands of Angelinos who now live paycheck to paycheck.

Given these realities, it’s not surprising that California has often led the country in Chapter 7 bankruptcies, for many years. With so many residents of the San Gabriel Valley in dire financial shape, large percentages of them opt to simply give up and declare bankruptcy. But they should know that there are other, sometimes far better options.

Debt settlement can help certain types of debtors get out from under the weight of financial distress, without the horrendous costs of declaring bankruptcy.

Some San Gabriel Residents could benefit from debt settlement

Debt settlement has a few distinct advantages. For one, it can capture most of the gains of a bankruptcy but doesn’t oblige the debtor to incur the horrific costs. For example, the best debt settlement companies can often reduce the principal amount owed by up to 50 percent or even more, in some cases. This can allow the debtor to pay off his debts far quicker than he would otherwise be able.

But debt settlement isn’t a good fit for everyone. For debt settlement to be able to provide lasting relief from financial hardship, the debtor should have only unsecured, consumer debt. Other types, such as student loans, alimony payments and child support usually cannot be dispensed through debt settlement.

The second requirement is that the debtor has gotten on a written budget that he is able to stick to and that will prevent a recurrence of the out-of-control run up of money owed. One of the most serious criticisms of debt settlement and a reason why it is often shunned by financial experts is that it fails to remedy the underlying cause of the debt run-up in the first place. If the underlying behaviors aren’t changed, the debtor will just return to the untenable financial habits that gave rise to the crisis in the first place. For this reason, it is imperative to positively identify the underlying spending habits that cause the debt and then come up with a written plan to avoid them in the future.

Finally, the debt load must be somewhat small in relation to the debtor’s income. A good rule is that the debt settlement program should have a realistic shot at completion within, at most, three years. Ideally, the debtor should be debt free within a few months to just over a year.

The debtor should pay careful attention to the terms of the debt settlement agreement and make sure that he is getting a sold value for the fees he is paying. The best debt settlement companies can often get the principal reduced by 50 percent or more, and this is what the debtor should be ideally shooting for.