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Home > Ask The Get Out of Debt Experts > I Signed Up With a Debt Settlement Company But I’m Afraid to Quit. – Frank

I Signed Up With a Debt Settlement Company But I’m Afraid to Quit. – Frank

Frank

“Hello Steve,

I have about 27K in credit card debt, 6 cards total. I am late on most of them, but they haven’t been charged off. One card though recently was removed from my profile where I can no longer make payments on the bank website. I make enough to participate in a DMP, but recently signed up for Debt Settlement Plan which I now have regrets about doing. I could really use your help. Thanks.

Thank you for taking my question. I spoke with a representative from a debt settlement company last week and while at the time it seemed like a great idea, I now get knots in my stomach thinking about all of the adverse outcomes that can and will result by participating in a settlement program. The rep on the phone was very sly, rude, pushy and managed to convince me to sign up for a debt settlement program. She took all my information, including my checking account number and routing number for debit purposes, and assigned me to a local law firm in Southern California.

After hearing all of the nightmare stories, I have chosen to go with a debt management program instead. By giving a verbal commitment and signing some electronic forms the rep sent me (she was quick about that as well to sign electronically), have I already committed myself to this program? I really need to get out of this settlement program. I haven’t paid the attorneys a penny. My first scheduled payment is going to be deducted on the 25th of this month. Do I just simply write a letter explaining how I wish not to participate in the program or will they turn around and say something like “too late, you’ve signed the dotted line and if you don’t pay we’ll sue you!” I don’t want to give the law office a single dime and need to get out before I even begin. Thanks again Steve for helping me with this question. I’m losing sleep over this and you are truly a saint for helping people in situations similar to mine.

Frank”

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The Answer

 

Dear Frank,

No worries my friend. We can fix this.

First step, if it is not a major hassle and you don’t have a lot of automatic debits that you can change, I would suggest that you ask your bank to change your checking account number. This will block the debit. I’m sorry to say I don’t trust the debt settlement company to say they are going to not take it.

Next, send a letter by some sort of traceable means like UPS or FedEx signature delivery requested and tell them you wish to cancel out of the agreement and that you appreciate their cooperation. If this matter can’t be worked out then you will escalate the matter and file a formal complaint with the Attorney General in California and the state you live in. You don’t need to be nasty, just lay out what you expect and what action you will take if those expectations are not met.

As far as the debt settlement company sales approach, they used the electronic documents because they know the close rate is higher using them than sending you documents by mail. Take a look at the advertising material from DocuSign.com. My favorite part of the message is ” It was like magic was injected into our sales force.”

In 5 minutes, I can show you how DocuSign is helping debt settlement companies use electronic signatures and esign to:

  • Get contract delivered to customer instantly, without the cost overnight shipping
  • Double contract return rates by making signing easy for customers and staying ahead of the competition
  • Save time by making sending contracts simple
  • Eliminate NIGO (contracts returned not in good order) rates

With debt settlement companies, like EFA Processing, DebtZero, America’s Debt Solutions, FM Financial, Freedom financial, DebtErase, First Choice, and hundreds more using DocuSign to get more contracts signed faster, easier, and without the cost of using overnight shipping, DocuSign Electronic Signatures are an obvious choice to accelerate your business and stay competitive.

“When we started using DocuSign, great things started happening for our business…our contract return rate improved from 35-40 percent to 75-80 percent. It was like magic was injected into our sales force.” – Paul Boyd, Executive Vice President at EFA Processing

You got bullied into signing and now you just need to work your way out with grace and professionalism. Don’t start screaming at them. Kill them with kindness and follow through on this plan.

I really think you’ve caught this in time and that outside of a pain in the ass to change your account number with your bank, this will work out just fine. Follow the plan and please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

I Signed Up With a Debt Settlement Company But Im Afraid to Quit.   Frank
Get Out of Debt Guy – Twitter, G+, Facebook

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

I Signed Up With a Debt Settlement Company But I'm Afraid to Quit. - Frank by

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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.
  • CATHY

    WE HAVE BEEN WITH A DEBT SETTLEMENT COMPANY SINCE FEB 2009.
    THERE COMMUNICATION AND RESPONSE TO QUESTIONS ARE AWFUL. NOW
    WE HAVE A DEFAULT JUDGEMENT AGAINST US BECAUSE OF THEM. I KNOW THAT A PERSON CAN GET SUED OVER DEBT SETTLEMENT, BUT TTHIS ONLY TOOK 3 MONTHS. WE RECEIVED A LETTER IN MAY 2009 FFROM A COLLECTIONS AGENCY SO I SENT IT TO OUR SETTLEMENT
    COMPANY AND SHE TOLD ME NOT TO WORRY ABOUT IT. SO THEN IN
    JULY WE GOT SERVED PAPERS THAT THE CREDIT CARD COMPANY WAS
    SUING US WE HAD 20 DAYS TO RESPOND. SO I SENT THE LETTER
    TO THE SETTLEMENT COMPANY. SHE CALLED THE LAWYER OFFICE THEY ASKED FOR THE POWER OF ATTORNEY WE HAD TO SIGN FOR TTHIS DEBT SETTLEMENT COMPANY. THEY DID NOT SEND IT UNTIL THE ATTORNEY OFFICE ASKED FOR IT 3 TIMES THEN THE SETTLEMENT COMPANY SENT IT. SETTLEMENT COMPANY NEVER DID
    ANYTHING ELSE UNTIL I DIDN’T EVEN HEAR FROM THEM UNTIL I FINALLY DECIDED TO CALL THE ATTORNEY OFFICE MYSELF AND THEY SSAID I HAD X AMOUNT OF DAYS BEFORE THEY GARNISHED OUR WAGES AND LEINED OUR PROPERTY. CO FINALLY I GOT A HOLD OF THE SETTLEMENT COMPANY THEY OFFERED THE ATTORNEY 12% OF THE TTOTAL DEBT THEY SAID NO. ANYWAY NEEDLESS TO SAY THE DEBT SETTLEMNT COMPANY WAITED TO LONG BETWEEN CORRESPONDENSE WITH US WE HAD TO SETTLE FOR FULL AMOUNT DUE, WHICH MEANS
    MONTHLEY PAYMENTS. NOW WE HAVE A DEFAULT JUDGMENT AGAINST
    US. CAN I SUE THE DEBT SETTLEMENT COMPANY NOW THAT THERE IS ADAMAGES AGAINST US BECAUSE THEY FAILED TO DO THERE JOB. I
    NO THAT A PERSON CAN GET SUED BECAUSE THAT DO NOT PAY THERE
    BILL, BUT THE DEBT SETTLEMENT SHOULD HAVE SAID YOU NEED TO GGET AN ATTORNEY OR AT LEAST RESPONDED IN THE PROPER TIME. NNOW THEY WONT ANSWER MY LETTER OF COMPLAINT, BECAUSE THE
    CEO SAID THEY WERE BUSY WITH OTHER ACCOUNTS LIKE MINE.
    THANK YOU
    CATHY

  • Frank G

    Thank you Steve!! I really appreciate your advice. I’ll be able to sleep better tonight knowing this. Take care and keep up the great work you do for so many!!!

    -Frank

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