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And the next industry under investigation....Debt Settlement


For years, I've cringed when I hear those offers to "Wipe out your debt" or "Repair your credit."
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Now, New York Attorney General Andrew Cuomo has launched a nationwide investigation of the debt settlement industry.

It's about time. I don't know why people have insisted that the way to fix their debt problems is to pay someone to fix them. But they do.

"In the end, most consumers who turn to debt settlement firms for help wind up worse off than before -- with higher debts and lower credit scores than when they first asked for help," Susan C. Keating, president of the National Foundation for Credit Counseling, said in a recent statement.

I've heard the stories. The consumer stops paying his debt on the advice of the debt settlement company. The fees start piling up. The creditor sues the consumer. Even if the debt eventually is reduced, the fees for getting this done were high, debt forgiveness can trigger additional federal income tax, and the experience was very rough.

Cuomo announced he's looking into the business practices of 14 firms and one law firm.

He issued subpoenas to:
American Debt Foundation, Inc.; American Financial Service; Consumer Debt Solutions; Credit Answers, LLC; Debt Remedy Solutions, LLC; Debt Settlement America; Debt Settlement USA; Debtmerica Relief; DMB Financial, LLC; Freedom Debt Relief; New Era Debt Solutions; New Horizons Debt Relief Inc.; Preferred Financial Services, Inc.; U.S. Financial Management Inc. (also knowns as My Debt Negotiation) and the Allegro Law Firm.

According to a news release from his office, the subpoenas are for information about the companies’ fee structures, how many people have benefitted from the companies’ services and what kind of relief the companies are actually providing.

Cuomo's office also said it is also investigating Nationwide Asset Services, Inc.and Credit Solutions of America.


Categories: Credit and Debit (14)
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Comments

We don't want to pay our bills and along comes these low lives telling us we can consolidate and eliminate debt. The American way is to build credit then max it out and declare bankruptcy.


Thanks so much for taking the time to post this information. With the economy the way it is right now, with all of the layoffs and more to come; government spending and deficit out of control; the continued housing slump; one wonders where to turn for help. It is nice to know that someone is putting out the information we need to protect ourselves, as consumers.


Thanks so much for taking the time to post this information. With the economy the way it is right now, with all of the layoffs and more to come; government spending and deficit out of control; the continued housing slump; one wonders where to turn for help. It is nice to know that someone is putting out the information we need to protect ourselves, as consumers.


These so called "debt settlement" companies can not do anything more than what anyone can do.
What they do is: once you stop payments, 2-3 months later they contact your creditors and ask them to settle the dept at 30 cents, 40 cents or so to a dollar. Anyone can do the exact same thing also, depending on the situation some creditors will accept a partial payment on what you owe and run with it. The only difference is, you don't pay fees to a third party and actually creditors are more willing to work with the debtors than a third party.


There is only one way to get out of the debt zone and that is to pay off your debt. No need to pay or hire someone who will just tell you to stop paying your debt as your best way out of debt because it is not. You could either ask your creditor to lower the interest rate or if you really want to pay off your debt in lower interest rate then why not consider consolidating your debt.

Avoiding or not paying debt even declaring bankruptcy will not help you in any way.

It is really a good thing that the Fed is spending some time to correct this issue.


Markets need to be made aware on different debt financial processes , proper educating programs may facilitate proper processes .


These debt settlement firms are scum and preying on people in desperate situations. They should also investigate the collection agencies in New York and South Florida. These companies owned by Scott Somerman of Hollywood FL prey on companies that performed work or provided a service to another company and are not getting paid. They claim to get your client to pay in 10 days; they then settle the debt which is owed to your company for a fraction of the money owed and keep the money and disappear.
This is a sector of the market filled with scum bags and needs to be regulated. Collection Agencies, Debt consolidation, and foreclosure!!
They know the juristiction limitations and fraud the business owners, consumers and others; committing wire fraud and fraudulent activities.


Its nice to hear that govt has taken some initiative to investigate and take action against bogus debt settlement companies. Not only the poor consumers will be saved but it will give rise to the genuine companies in the industry.


Well, it’s amazing. The miracle has been done. Hat’s off. Well done, as we know that “hard work always pays off”, after a long struggle with sincere effort it’s done.
------------
dwilson1707

Settlement Debt


This is a wonderful opinion. The things mentioned are Great and needs to be appreciated by everyone.Credit Card Debt


This is a wonderful opinion. The things mentioned are Great and needs to be appreciated by everyone.
Credit Card Debt


This is a wonderful opinion. The things mentioned are Great and needs to be appreciated by everyone.
Credit Card Debt


Hopefully, the government will be successful in its investigation of these fraudulent companies that prey on individuals and families who are already in a financial rut. And once those companies are caught red-handed, they should be reprimanded or punished rightfully so as to set examples for other companies who plan on doing the same.

Debt settlement is a very valuable program in helping borrowers get out of debt especially in difficult financial times such as now. Now that there is very little left with our home's equity, an unsecured debt settlement may be the only answer to so many Americans debt problems.


Whether debt consolidation is fine or not depends on little things. One of these things is the type of debt consolidation that is done and the other is what you have done to keep from using your credit cards.


First for all, our youth need to be taught that if they want it, they can't have it now unless they have the money in hand and borrowing means losing their freedom. Accountability is non existent when it comes to paying back loans and that's why credit is taken lightly. Imagine it borrowers could be forced to take a second job if money was not paid back in full within a certain amount of time, they'd think twice about taking that risk.

And debtors need to realize that hiring Debt Settlement firms is not addressing the cause, but rather applying a band aid.


While you decide to hire the services of a debt settlement agency, you must actually check out the testimonials and ask personally about it's reliability from it's old customers. Otherwise, there are chances of falling prey at the hands of a fraudulent debt settlement agency.


When one finds themselves in financial troubles they may not know what to do. It seems that the only way out of financial difficulties is through filing bankruptcy, but this is not necessarily the answer. Bankruptcy laws have changed and it is now harder to qualify for Chapter 7 bankruptcy. Chapter 13 bankruptcy does not always provide the protection one really needs. Bankruptcy does not protect a person from wage garnishments or stop debt lawsuits. In addition, it will give control of one’s finances to a third party who will do what they feel is best despite your wishes.

This can be an unsettling way to deal with a tough situation. When one has lost their job or income they need help in stopping payments and stopping debt lawsuits that can garnish their wages and other assets. There are many ways that one can accomplish this, but in order to be successful at it, one may find that they need the help of those who have had experience in such matters and can help to create the legal documentation that will do so. This can be a difficult task for someone who does not know the legalities of the situation.

Using a service can help you in dealing with creditors and in stopping debt lawsuits. A good service will make a credit collection agency prove their claims which can be difficult for them to do if they have acquired the debt from another company. In addition this can also stop lawsuits that really have no basis. A good service can also help you in getting your creditors to lower the amounts you owe and help in establishing a payment plan that you can work with, one that you are involved in creating and therefore that goes along with your wishes. This can be a tremendous benefit in gaining control of your finances.

There are many services that claim to be able to help by counseling you in your finances and consolidating your debts. In some cases this can be beneficial but to get the maximum benefits one needs to be able to stop debt lawsuits and protect their assets. They also need to find ways to decrease their debts while lowering the payments that they have to make. When one is looking for such a service it is important to determine exactly what they offer and how much experience they have in handling such matters. This can be your best decision in determining what will work the best in your situation.


This is very niche and excellent content love to see more post like this..keep posting. Thanks for information ..bravo...


This is very nice and interesting post.Keep up the good work.

Thank You for Sharing.


"In the end, most consumers who turn to debt settlement firms for help wind up worse off than before -- with higher debts and lower credit scores than when they first asked for help"

...this is due to the upfront fees all the debt settlement companies charge! Which are now illegal under the new FTC laws, but most companies are still finding loopholes...

Check out SettleFirst.com, they don't charge a penny up front, no bull! Unheard of!


It is true that people should take care of their own debts, but is it possible by each and everybody? The answer is no. Definitely, at present, the fiance market comprises of lots of companies offering debt relief services are scams but not all of them. An entire industry cannot be corrupted.

You need to find the genuine company, which delivers service. A thousand of people are also present who got benefited by this industry but unfortunately those people who got trapped by the scam companies and were cheated only raise their voice.

It is very simple, try to look our for a company who will not charge you anything upfront. Service at first then paying fees, follow this principle and you will not get cheated.


Most of the debt relief scams have been sifted through and detected at this point, although some still linger. With the economy in such bad shape, many people can benefit from debt relief because it sure beats filing for bankruptcy. With debt settlement you will recover and your credit report will have a "paid balance" when you complete the settlement, which will improve your score. More than ever, 'cash is king' and debt settlement will put cash back in your bank account and pocket in 1-3 years.


Hi,
If you want to get more details about debt managers then you can visit the following link :- http://www.debtmanagers.ca/


Thank you for posting this information. People with debt settlement issues should contact a licensed reputable attorney, like me. I have the skill and experience to fight debt collectors. 212 766 3323


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Debt is a stressful thing for anyone to deal with. It certainly doesn’t help that you probably have creditors and collectors harassing you at all hours and making you feel worse about the situation.


Hi,
Thanks for the this information about debt solutions. Relay nice Article.Debt solutions offered by debtclearsolutions.com are designed to match your personal financial requirements and solve your financial trouble. Get free consultation and customize your debt solution today!Debt solutions


I completely agree that a large ammount of settlement firms should be investagated and that more regulation is needed so that people know exactly what they are getting themselves into. I wrote an article about the experiences that i have had and issues reported to me by my clients. I think the read may be useful. Here is a link:

http://www.bydesignsolutions.org/little-known-facts-about-debt-settlement

Hope this helps.


I completely agree that a large amount of settlement firms should be investigated and that more regulation is needed so that people know exactly what they are getting themselves into. I wrote an article about the experiences that I have had and issues reported to me by my clients. I think the read may be useful. Here is a link:

http://www.bydesignsolutions.org/little-known-facts-about-debt-settlement

Hope this helps.


Well it is true that not everyone can get his debt settled on his own as it requires proper understanding of finance and basic knowledge of finance related laws. if you have all these then you can try to negotiate with your creditors for debt settlement.


Thanks for this important information about debt solution. This is very niche and excellent content. It is very good that govt has taken some steps against debt settlement company for this action not only the poor saved but also it will be helped others.


I am looking for a debt collection company in Europe, anybody can suggests me? I was soo happy with emiratesdebtcollection.com
for my Emirate debts recovery


Thank you so much for taking the time to post this information. It is very important informative post. It will help us. It’s nice to hear that govt has taken some initiative to investigate and take action against bogus debt settlement companies. Not only the poor consumers will be saved but it will give rise to the genuine companies in the industry.


Hi,
Thank you for posting this information. People with debt settlement issues should contact a licensed reputable attorney.I completely agree that a large amount of settlement firms should be investigated and that more regulation is needed so that people know exactly what they are getting themselves into.
your blog was too good. i really appreciate with your blog.Thanks for sharing.

debt solutions


Hi,
Thank you for posting this information. People with debt settlement issues should contact a licensed reputable attorney.I completely agree that a large amount of settlement firms should be investigated and that more regulation is needed so that people know exactly what they are getting themselves into.
your blog was too good. i really appreciate with your blog.Thanks for sharing.

debt solutions


Hi Admin,

I am Dan, a financial writer. Today I came across your site trb.com and enjoyed reading some of your articles.

I just want to know do you allow guest posts? I would like to write for your blog on some relevant topics that is still to cover on your blog.

I will make sure that my articles will be completely unique and free to serve the purpose of your website. I do believe your readers will enjoy reading it.

It will be a thrilling experience for me if my article finds a place in your blog.

Please let me know about your decision.

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About the author
You've got the job of managing your money. No one in school taught you how. But you and I, we can teach each other, how to handle it, how to save for retirement, how to make money last, how to educate the kids, how to make a budget work. The conversations I have with my readers are fun. Money's important, but discussing it does not have to be boring.

Harriet Johnson Brackey Harriet Johnson Brackey, the personal finance columnist for the Sun Sentinel, is an award-winning business reporter. Her columns for 2008 were named "The Best in the Business," a national award chosen by her colleagues at the Society of American Business Editors and Writers.

Brackey has worked at Business Week magazine and at USA TODAY, where she was a founder and part of the original staff of the Money section at the country's first national newspaper. After nearly 11 years there - spent covering the 1980s bull market, the insider trading scandals, the 1987 crash - Brackey left Washington, D.C., and came to The Miami Herald. She spent the next decade writing a column about personal finance that chronicled the stock market's Internet boom and bust, as well as the popular Money Makeover features.

Brackey also has done commentaries for Marketplace Money, which airs on National Public Radio and The Nightly Business Report which is broadcast on more than 250 PBS television stations nationwide. She also has been a radio guest on WLRN’s Miami Herald News.
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