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Home > Debt Relief Industry > Business Models > What Am I Missing in This Preferred Financial Services Affiliate Pitch? It Does Not Make Sense to Me.

What Am I Missing in This Preferred Financial Services Affiliate Pitch? It Does Not Make Sense to Me.

A tipster (send in your tips here) brought the following page to my attention from the Preferred Financial Services site which says:

What Am I Missing in This Preferred Financial Services Affiliate Pitch? It Does Not Make Sense to Me.

The pitch seems to be to switch and become their affiliate and outsource all the back office stuff to them so you can “focus on front end operations.” But the charts show your overhead expenses remain the same in either model. What are companies going to do, convert back office staff to front office sales people and keep them on the books? In addition the models presented don’t represent that current companies will have some continued funds rolling forward each month from fees. It also seems to show that by becoming an affiliate that you’d start to immediately begin earning fees and income but how many people are going to settle enough debts in the first eight months to generate $75,000 a month? It looks like the pitch is the PFS solution has some component of up-front or advanced fees through a potential attorney model.

Does anyone have any experience with PFS on this approach?

Here is what they say:

Benefits of Working with PFS

With the coming changes in the Debt Settlement industry, PFS has your solution to maximizing your profitability during the transitional phase. PFS is not only a short term answer but also can improve your business over the long run.

To remain operational over the next 6-12 months, debt settlement companies need to adjust to the new FTC regulations. This means there will be a restriction on charging advanced fees and limiting the total fee you can charge for your services. Operationally this means you will see a dramatic drop in revenue in the short run as well as potentially lower revenues in the future. To make sure your business survives through this transition and well into the future, PFS has created a program that allows you to focus on front end operations rather than dividing your company’s resources between your front and back end departments.

PFS has projected a typical Debt Settlement company’s revenues and expenses over a 12 month period to show you just how different your business model will be after the FTC adjustments. – Source

What Am I Missing in This Preferred Financial Services Affiliate Pitch? It Does Not Make Sense to Me.

As you can see, the realities of the new business environment will result in the following:

  1. You will not break even until month 8 at the earliest if everything goes according to plan.
  2. You will lose over $80,000 over the first 12 months of operating under the new rules.
  3. Your expenses will not change significantly during this time period, even though your revenues are dropping dramatically.
  4. More importantly the money you spend keeping up with the business will never come back to you…

What Am I Missing in This Preferred Financial Services Affiliate Pitch? It Does Not Make Sense to Me.
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Damon Day

    Hello Joe, unfortunately I think many of the owners of these programs would actually put their closest friends into the program with the same fees. I have sales people tell me all the time how great their program is and they referred their family and friends because they believe in it so much. The problem is many of these guys have convinced themselves that their front loaded fee programs are a good thing and whenever a consumer fails it must be the consumers fault.

  • Damon Day

    Ha ha, hey Big C, are my comments striking to close to home?

  • Bigc

    Stop being a little b*tch.

  • Joe_debt_jr

    most backend settlement companies lies about their retention rate just like lead marketers lie about their conversion rate. the business in my opinion is corrupt and making it nearly impossible to trust. all the business owners should ask themselves would they put their closest friends in a debt settlement program and if so how much will they charge them?

  • Damon Day

    Is it just me or does anyone else notice that most debt settlement companies never brag about the results they obtain for their clients? It is just about staying in profit, keeping the dollars rolling in etc. Why aren’t these guys bragging about their back end success rates? Wouldn’t that be the only reason you would want to refer clients to them? Unless of course your motivation for referring clients is simply to make money regardless of the outcome for the client.

  • http://DamonDay.com Damon Day

    Is it just me or does anyone else notice that most debt settlement companies never brag about the results they obtain for their clients? It is just about staying in profit, keeping the dollars rolling in etc. Why aren’t these guys bragging about their back end success rates? Wouldn’t that be the only reason you would want to refer clients to them? Unless of course your motivation for referring clients is simply to make money regardless of the outcome for the client.

    • Anonymous

      most backend settlement companies lies about their retention rate just like lead marketers lie about their conversion rate. the business in my opinion is corrupt and making it nearly impossible to trust. all the business owners should ask themselves would they put their closest friends in a debt settlement program and if so how much will they charge them?

      • http://DamonDay.com Damon Day

        Hello Joe, unfortunately I think many of the owners of these programs would actually put their closest friends into the program with the same fees. I have sales people tell me all the time how great their program is and they referred their family and friends because they believe in it so much. The problem is many of these guys have convinced themselves that their front loaded fee programs are a good thing and whenever a consumer fails it must be the consumers fault.

    • Bigc

      Stop being a little b*tch.

      • http://DamonDay.com Damon Day

        Ha ha, hey Big C, are my comments striking to close to home?

  • Matt

    Right-o. Fancy meeting you here, Mike!

  • Mike Reilly

    PFS has projected a typical Debt Settlement company’s revenues and expenses over a 12 month period…..I sure would like to know their assumptions for a typical Debt Settlement company. Without them, these charts and their claims are worthless.

    Mike Reilly, CDS
    Emerge America, LLC.

  • Mike Reilly

    PFS has projected a typical Debt Settlement company’s revenues and expenses over a 12 month period…..I sure would like to know their assumptions for a typical Debt Settlement company. Without them, these charts and their claims are worthless.

    Mike Reilly, CDS
    Emerge America, LLC.

    • Matt

      Right-o. Fancy meeting you here, Mike!

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