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I’m in a Debt Settlement Program with CNI and I Got Sued by Amex. They Told Me to Ignore It. – Mary

“Dear Steve,

I am already undergoing debt settlement with CNI. CNI has paid off a couple of my credit card debts. I received a lawsuit from American Express 6/30/09, and sent that in to CNI . CNI told me I dont have to do anything.

Do I have to put something in writing to the courts to at least tell them that I am acknowledging the debt and am working with CNI to get this settled? Do I have to hire a lawyer? Any advice is appreciated. Thanks!

Mary”

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The Answer

 

Dear Mary,

I am assuming that CNI is Century Negotiations Inc. from North Huntingdon, PA.

If what you are saying is true that CNI told you to disregard a lawsuit by American Express that is the worst advice I think I’ve ever heard. Not only should you not disregard the suit but you better get yourself to a lawyer, today! Time is about to run out on your response date.

CNI knows better than to tell people to avoid a lawsuit by a creditor. In fact they even tell people about it on their website on their hidden disclosure page.

Here is what CNI hides but discloses on their site.

I want you to read number 4 that I bolded for you closely.

Century Negotiations, Inc. is a member of The Association of Settlement Companies (TASC) and as such has agreed to publicly disclose the following on each of their website and as part of their contract with consumers. Should you wish to comment on their use or avoidance of this disclosure please email [email protected] with your contact information and the nature of the complaint. A TASC board member will get in touch with you in short order.

Disclosure Statement

Century Negotiations, Inc (CNI) provides consumers with a method of debt resolution known as debt settlement. Debt settlement is an aggressive method of debt management, which depends on the negotiation of mutually agreeable settlements between the consumers and the creditors. CNI wants you to understand both the potential benefits and pitfalls that may arise out of the debt settlement process and to have reasonable expectations regarding the outcome.

BY SIGNING BELOW, YOU ARE STATING THAT YOU UNDERSTAND ALL THE ISSUES BELOW:

1. You are enrolling into a debt settlement program after voluntarily seeking the assistance of CNI. The goal you have set is to have CNI negotiate mutually agreeable settlements between you and your creditor(s) for payment of certain unsecured debt(s) described as Enrolled Debts. No specific results can be predicted or guaranteed.

2. You will be responsible for saving sufficient funds that you control to fund debt settlements that CNI will endeavor to negotiate on your behalf. You and only you will be in control of all settlement funds and under no circumstances will CNI have custody or control of the funds you set aside to fund debt settlements.

3. The savings program that you have made to reach your debt settlement goal is detailed in your Client Agreement. Summaries of the total settlement amount, monthly savings, and the period needed to reach your goal were prepared based on the goal you selected. Those summaries reflect the minimum amount that we have estimated you will need to save to put yourself in a position to reach your goals. Actual settlement amounts, necessary savings and the period required to reach your goal may vary based on creditors actions and other factors that may affect or prevent the realization of your goals.

4. Most creditors and collectors negotiate with Debt Settlement Service Providers, but CNI cannot force the negotiations and cannot force creditors to accept a settlement. CNI does not make regular monthly payments to your creditors. Your creditors may continue collection efforts on delinquent accounts while you are enrolled in a Debt Settlement Program. Such collection efforts can include phone calls and letters to you, charging off the account, sending accounts to collection agencies or attorneys, lawsuits and even garnishments of your wages if a judgment has been obtained CNI makes no claim that it will be able to stop these collection activities. These activities may continue while CNI is making its best efforts to negotiate your debt.

5. Your Debt Settlement Program assumes an effort that will continue for many months. The time needed to produce a settlement depends on a number factors. These may include: (a) your financial hardship, (b) the age and balance of the accounts that you owe your creditors, and (c) the funds you have available to pay for a settlement; and (d) the willingness of individual creditors to enter into debt settlement negotiations. While no guarantees can be given, generally the quicker you save money the sooner you will be in a position to reach your goals. Increased savings will provide you with the option to accept lesser discounts and will also enable you to accumulate funds to reach your debt settlement goals more quickly. However, any settlement must be acceptable to both you and your settling creditor.

6. The fees paid to CNI are intended to compensate the company for its efforts and will only be refundable to the extent they have not been deemed to have been earned in the manner described in the Client Agreement. Those fees are not being set aside or held in escrow to fund debt settlements. Fees paid to a Debt Settlement Services Provider such as CNI for its services will not be available to pay creditors.

7. Communications with creditors are handled on a case by case basis. In some instances creditors may not be contacted until several months after you enroll.

8. You have stated that, because of circumstances beyond your control (hardship), you are unable to meet the minimum payments required by your creditors. If you do not make required minimum payments to your creditors you may be breaking the terms of your agreements with them and your actions will probably be reported to consumer reporting agencies as late, delinquent, charged-off or past due balances. Your creditor may also raise the interest rate on your account and impose other penalties. Your account balance may continue to grow as your creditor adds accrued interest, late fees, over-limit fees and penalties. Your balance may continue to grow until a settlement is reached with your creditor; and, if negotiations are unsuccessful, you could be called upon to pay the entire balance. After settlement your creditor may comment that the account was “settled for less than the full amount” on your credit report. A Debt Settlement Program may have an adverse effect on your credit report and credit score.

9. When your creditor settles your debt, a savings of $600 or more off what you owed may be reported by your creditor to the IRS as Discharge of Indebtedness income. You may wish to consult your tax advisor to determine whether your individual circumstances may permit you to exclude any such Discharge of Indebtedness Income from your reportable income due to insolvency. For more information on tax ramifications to you personally you may also wish to consult a CPA or Tax Attorney and to refer to the IRS website www.irs.gov IRS Publication 908- “Bankruptcy Tax Guide” and IRS Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness available on the IRS website.

10. You acknowledge that CNI is not a law firm and cannot provide legal advice.

11. You understand that you have the responsibility and the right to communicate my comments directly to the company’s management using the information provided below:

Company: Century Negotiations, Inc.
Address: 1061 Main Street Banco Park North Huntingdon, Pa. 16542
Manager’s Name: Heather Longo
Manager’s Phone Number: 1-888-913-8784 ext 3040
Manager’s email: [email protected]

Furthermore, upon request you will receive a letter from the Company describing the grievance policy and the refund procedure. Finally, you have a right to report any concerns directly to TASC via email: [email protected]

To summarize, Each case is unique and results may vary: A Debt Settlement Program can be a very effective way to resolve your debt, but it is not a painless process and no guarantees can be given because the process is subject to factors that neither you nor your service provider may be able to control. As with any type of debt repayment plan, failure to complete a Debt Settlement Program is likely to have negative consequences on your financial situation.

Working with a debt settlement company does not prevent any creditor from enforcing their legal contractual rights in court. Your election to pay a debt settlement company instead of the creditor is not an excuse. Based solely on the facts at hand, you will lose and American Express may go so far as to garnish your wages.

I suspect that by the time you leave the office of the local lawyer you need to go see ASAP that you will want to use the following link for the Pennsylvania Attorney General and file a consumer complaint online against CNI.

Big Hug!

Im in a Debt Settlement Program with CNI and I Got Sued by Amex. They Told Me to Ignore It.   Mary
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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.
  • content employee

    I do work for CNI and I am in their Priority Department. We NEVER tell our clients to ignore litigation from a creditor. If a suit is filed, we contact the Attorney’s office for possible resolutions on the account, we also call our clients back within 24-48 business hours to discuss the summons. I can tell you from experience, We are not Attorneys and CAN NOT give our clients legal advice. We tell out clients that if they chose to file a response to the courts, they could, giving the court notification of their hardship and giving notice that we are assisting on their accounts. At times a summons may only request that a written response be filed within a certain amount of time, others demand that a written response is filed. If our clients choose to not resolve a legal account, we require a written statement from the client requesting to freeze negotiations on an account. We do not take our jobs lightly and settle out hundreds of accounts monthly, including legal accounts.

  • content employee

    I do work for CNI and I am in their Priority Department. We NEVER tell our clients to ignore litigation from a creditor. If a suit is filed, we contact the Attorney’s office for possible resolutions on the account, we also call our clients back within 24-48 business hours to discuss the summons. I can tell you from experience, We are not Attorneys and CAN NOT give our clients legal advice. We tell out clients that if they chose to file a response to the courts, they could, giving the court notification of their hardship and giving notice that we are assisting on their accounts. At times a summons may only request that a written response be filed within a certain amount of time, others demand that a written response is filed. If our clients choose to not resolve a legal account, we require a written statement from the client requesting to freeze negotiations on an account. We do not take our jobs lightly and settle out hundreds of accounts monthly, including legal accounts.

  • gregory a krejci

    I am deeply involved with CNI and have had one bill settled. At the rate we are going, I could be into this for more than I can handle. My trouble is that my wife is finishing her schooling so that she can start teaching. If we declare bankrupsy, she may not be able to get her student loans and would lose all the work she has done.Just wondering if anyone has an idea as to where we should turn. We are about 30,000.00 in cards.

    • Jon

      Gregory get out of this program and call Paul Michaels, he saved me a ton on settlements and did not charge me any upfront money. He specializes in working with creditors…#469-735-1525 is his number.

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