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Debt Settlement Companies:

Date: Tue, 04/26/2005 - 05:40

Submitted by Pammila
on Tue, 04/26/2005 - 05:40

Posts: 112 Credits: [Donate]

Total Replies: 10

Debt Settlement Companies:


debt settlement5 Companies are not the same as debt counseling Companies (debt consolidation).
[list=1]
  • You have to pay a start up fee
  • You set up a savings account
  • You sign over a limited power of attorney
  • You set up for your creditors to mail billing directly to them.
  • They take a percentage of the money they save you after settlement has been accomplished.

    Find that most people believe these companies to step in immediately and settle up with the creditors / collection agencies. That is not going to happen!

    They are going to hold off paying the creditors as long as possible, even as far as you receiving notice to appear in court. Once that happens then they send letter to the collection agencies to validate the debt, and then start negotiating for the lowest amount to be paid.
    [list=1]
  • The collection company does not have to deal with these debt settlement companies and you may just find your self having to appear in court, you are still accountable for their actions - should they fail to succeed.

  • This is far worse then debt consolidation in the fact that the creditor is being settled with not paid in full, so when you try to go for a loan this will look bad on your credit report.

  • If you had creditors that started out as agreed, no lates or collections prior to this company stepping in, that will no longer be the case by the time they are done. All accounts will be charged off and reflecting so on the credit report. They are not in the business of cleaning up your credit report - they are in the business of saving as much money as possible and will destroy your credit in the end to meet their goal.

    Negative information will remain on your credit report technically for 7 years, collections; charge offs; judgments resulting from your encounter with these companies.

    So please becareful of what companies you deal with, debt consolidation is a bad company to go with, but these debt settlement companies are just preying on those in desperate need.

    Should you find yourself already in the middle of being signed up with one of these companies, you should immediatley stop (there may be penalties incurred) but you will be better off to get out from under this type of company. And deal directly with the creditors yourself to resolve the problem and save your credit rating.


    • Good afternoon,

    I just joined today and am hopng this community and services will be my answer. I went with a company called Positive Return and it has completely backfired. The comapny went under, I'm being garnished, etc.

    Advice on dealing with a company like this would be appreciated.

    Thanks,
    Chad


    lrhall41

    Submitted by chnordhagen on Sun, 05/01/2005 - 13:39

    ( Posts: 2 | Credits: )


    Would suggest contacting your states attorney general's office to get assistance from them, if you paid in money you might be able to fight for a refund. Also file complain with the Better Business Bureau, demanding your money back.

    These are the two agencies I know of that can help you now with this case, might not hurt to contact an attorney either to see what other legal assistance may be available to you.

    Did the creditor succeed in getting a judgment against you? Sounds like it if you have wage ganishment. Nothing you can do at this point to reverse the garnishment, unless you can negotiate settlement sooner. Try to pay the creditor in exchange for dismissal of the judgment, damage control to fix the credit reporting.


    lrhall41

    Submitted by Pammila on Sun, 05/01/2005 - 14:42

    ( Posts: 112 | Credits: )


    Hi Chad,

    I advice you to go for legal assistance immediately. :)
    Also go through what Pammila has advised you and I'm sure that will be of great help.

    Keep in touch and let us know about the further proceedings.

    Cheers,
    Jason


    lrhall41

    Submitted by Jason on Sun, 05/01/2005 - 21:57

    ( Posts: 2430 | Credits: )


    Really Great Post Pammila,

    Quote:

    So please be careful of what companies you deal with, debt consolidation is a bad company to go with, but these debt settlement companies are just preying on those in desperate need.

    The companies mentioned under debt consolidation care are helpful and more customer oriented. Many were helped

    Tintin


    lrhall41

    Submitted by BlogTintin on Mon, 05/02/2005 - 09:52

    ( Posts: 168 | Credits: )


    First, what a great community you have here, I am glad I was able to find it.

    I have filed with the BBB in NoCal where the company is located, as well as with my AG in CO adn the AG in CA. The BBB began to try and contact hte company, and then Positive Return finally responded to me. I simply asked for a partial refund of my "retainer fee" as well as the difference in an amount we had negotiated and now what I am being garnished.

    Problem is, I am in debt, so i can't afford an attorney. I tried to get this company to refund me what I felt they frauded me out of, but no luck as of yet. Basically the company said, sorry and now is back to ignoring my requests.

    Chad


    lrhall41

    Submitted by anonymous on Mon, 05/02/2005 - 22:03

    ( Posts: 202330 | Credits: )


    Additionally, when this company went under, they transferred the funds and accounts to another law firm. So I'm still with a company but I don't see value. I did get a call tonight from someone from this group.

    Basically, we had negotiated a $2900 with a Credit Union account, but the company failed to follow through with the transactoin. Instead, I'm being ganished $375-$400 per check which is killing me, and will end up paying $4300 in total. I asked the company to refund me the difference and my retainer fee, to which they have said no.

    Trying to find an attorney currently. Thanks all.


    lrhall41

    Submitted by chnordhagen on Mon, 05/02/2005 - 22:10

    ( Posts: 2 | Credits: )


    Hi chnordhagen,

    Legal assistance can be of greatest help at this moment. :)

    Please keep us updated.

    Cheers,
    Jason


    lrhall41

    Submitted by Jason on Mon, 05/02/2005 - 23:25

    ( Posts: 2430 | Credits: )