How to Get Out of Debt With the Get Out of Debt Guy » fdr

We Are With Freedom Financial And Getting Sued. – Anne

Steve Rhode — Tue, 13 Dec 2011 18:09:55 +0000

“Dear Steve,

I have been with Freedom Financial since early 2011. Have paid $7400 into a settlement acct ($1050 per mo) since May.

I have 8 creditors. FDR has reached a settlement with Advanta and Capital One. I’m not sure when the Advanta Payments will be completed, but the Capital One payments are supposed to be completed April 2012.

We have 6 additional accounts outstanding with a combined balance of $48,000. The remaining creditors are Chase, American Express, Discover, CitiBank, Sears, and another Capital One.

We have now received a summons from a law firm on behalf of American Express for $10,000. We have had no contact with AMEX or the law firm on advice of FDR.

A written response to the summons is due at the end of this week (which FDR does advise we respond). FDR says we don’t have enough money in our account right now to make AMEX an offer (Our settlement account balance shows $732.)

I have called FDR several times to inquire if they have made any contact with Amex or the lawyer and they keep putting me off saying they need more time. I don’t think they have had any contact.

After a couple of years of unemployment, my husband is presently employed. His company provides a business AMEX for company expenses, so AMEX knows all his work info, that he is employed etc. Our other creditors probably don’t have that info in their files since we were self employed for the 5 years prior to 2010.

I am concerned that the path we are on is leading to a pay garnishment, plus we have these other creditors looming out there as well.

I just don’t know what to do, and after reading a bit on your site about FDR I am concerned that the debt settlement approach was not the best idea. What do you advise we do at this point?

The absolute max we could devote to paying off creditors right now would be $2000 per month, and that would be close to a hardship. If my husband loses his job over this, it’s going to feel like the end of the world. Thanks in advance for your help.

Anne”

The Answer:

Dear Anne,

The only debt relief provider that can stop a creditor from suing is a bankruptcy attorney. I must admit that chain of events you’ve given me sounds a bit perplexing. FDR advises you respond but what is the response going to be?

It seems you did have an agreement with American Express and did break that agreement by not making minimum payments. American Express seems to be attempting to enforce their right under the agreement by taking you to court. If you lose it could end in a judgment and even possibly a wage garnishment.

It seems the path you were on was working for you but this suit by AMEX may change everything. It might not even be the last suit you’ll face since you have a number of creditors waiting in the wings.

Before this gets out of hand I would advise you to click here to find a local bankruptcy attorney and meet with them. Only then can you best understand the pros and cons that bankruptcy may mean for you.

I also urge you to get some specific advice from FDR about this suit and ask them what the possible outcomes are if you lose. You need to be well informed so you can make the best decision for you on how to proceed.

I’ll contact FDR and direct them to this post and ask them to comment.

Please post your responses and follow-up messages to me on this in the comments section below.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Freedom Debt Relief Looks Forward to Positive Changes from New FTC Rules

Steve Rhode — Tue, 17 Aug 2010 20:54:28 +0000

From How to Get Out of Debt

The following is a press release from the credit or debt world. The publication of this release by this site is not an endorsement of the release.

San Mateo, CA (PRWEB) August 17, 2010

The Federal Trade Commission (FTC)’s recently announced sweeping regulations on the debt relief industry. These reforms have spawned questions on what the rules mean, the impact on consumers in serious debt and the effect on the debt settlement industry.

Andrew Housser, co-founder and CEO of Freedom Debt Relief (FDR), is available to comment on the regulations, which will be implemented in two phases, on Sept. 27 and Oct. 27. Housser’s firm is the largest negotiator consumer debt in the nation, settling more than $400 million of debt in the last year, and Housser himself worked with the FTC for more than a year as the commission studied the debt relief industry’s practices, methodology and results. After a lengthy review process, the FTC has finally issued its rule, which seeks to protect consumers and wipe out debt relief providers that do not perform services consistent with consumer expectations.

“It is clear the FTC put significant work into crafting this rule, and approached it in a deliberate manner,” says Housser. “While we think the rule does not fully acknowledge the labor-intensive nature of debt settlement work, including work done before actual settlements are made, we believe there is more good in this rule than bad, and are looking forward to the positive changes it will bring to our industry.” FDR submitted testimony and data to the FTC for its review process, showing that the average consumer in an FDR program achieved debt reduction of three times the fees paid to FDR, and FDR graduates achieved debt reduction of 4.4 times the fees paid to FDR.

The FTC’s new rule specifies minimum standards for disclosures used in the marketing of debt relief services, and prohibits debt relief providers from making false or unsubstantiated claims about their services. Most significantly, says Housser, the rule prohibits debt settlement companies from charging and accepting fees before the actual settlement of a consumer’s debt.

“The new rules will require debt settlement companies to make significant marketing and operating changes, most significantly relating to how fees are earned,” he explains. The main challenge the industry will face, Housser says, is raising the capital to fund operations before settlements are negotiated. “The rule provides a significant capital challenge to our industry, but we are pleased that the FTC heard at least a few of our comments and reflected them in the final rule. These changes provide good companies that are getting results for consumers a fighting chance to continue as viable businesses,” he adds.

“The consumer has always been the guiding focus in our business, and we look forward to getting back to work providing a much-needed service,” says Housser. “FDR shares the FTC’s goal of advancing consumer protection, and under the new regulations, our goal continues to be that debt settlement remains a viable option for consumers in serious debt hardship. We are pleased that now there will be clear delineation from the companies that get results for their clients, and those that don’t.”

Today, individual Americans owe $2.5 trillion in consumer debt – excluding mortgage debt. The average American with a credit file is responsible for more than $10,000 in credit card debt. “Budgeting and lifestyle changes can help many individuals and families work their way out of debt, but for those who do need additional help, these regulations will help protect consumers looking for another option,” he says.

Debt settlement is a form of debt relief in which debt specialists negotiate directly with creditors on the consumer’s behalf to resolve the consumer’s debt balance. Offering an alternative to credit counseling, debt consolidation and bankruptcy, settlement programs help qualified clients fully resolve their debts, commonly in two to four years.

Freedom Debt Relief (www.freedomdebtrelief.com)

Freedom Debt Relief provides consumer debt settlement services. Working for the consumer to negotiate with creditors and lower principal balances due, the company has served more than 80,000 clients since 2002. The company is an Accredited Member of The Association of Settlement Companies and a Platinum member of the International Association of Professional Debt Arbitrators. FDR holds the Goldline Research Preferred Provider certification for excellence among debt settlement companies.

Freedom Debt Relief is a wholly owned subsidiary of Freedom Financial Network, LLC (FFN). Based in San Mateo, Calif., FFN also operates offices in Sacramento and Tempe, Ariz. The company, with more than 600 employees, was voted one of the best places to work in both the San Francisco Bay area and the Phoenix area in 2008 and 2009.
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Global Client Solutions & Rocky Mountain Bank & Trust, Good People Tangled in Some Bad Debt Settlement Business

Steve Rhode — Thu, 15 Oct 2009 14:32:02 +0000

From How to Get Out of Debt

First, let me say that in my life in the credit counseling and debt management world I have had an opportunity to interact with the folks at Global Client Solutions (GCS) and Rocky Mountain Bank & Trust. I always found them to be professional and competent at what they do, manage client accounts.

The Global Client Solutions mission, as stated on their site is:

“Global is a revolutionary banking platform, trusted to solely provide the most robust and up-to-date account management products to the debt management industry. Our program was built specifically for the debt management industry to create a positive environment of success for both the consumer and debt management company.”

But here is where the waters appear to get murky and muddy for GCS. It’s not their payment platform that is troubling in any way. I’ve never heard a single complaint from anyone that GCS and it’s partner or participating banking partner, Rocky Mountain Bank & Trust has ever, or in any way diverted funds improperly. And from my past interactions with GCS I would have serious doubts that ever would happen.

The murkiness is being created by the companies they have voluntarily elected to take on as clients and process banking account withdrawals, from consumers accounts, and disbursements to debt settlement companies.

The Slope Gets Slippery Right About Here

As the debt settlement industry falls deeper and deeper into the bad actors pit, they are dragging GCS and Rock Mountain Bank right down with them. What’s that old expression, if you fly with the crows you get shot down with the crows?

In a search of civil cases filed where Global Client Solutions has been named, 2009 had been a very bad year for them. Before 2009 I could only find a record of two previous suits against them, one in 2005 and one in 2008, but so far in 2009 there have been seven lawsuits in which they have been specifically named as defendants. And it appears that the lawsuits are picking up steam as the year progresses.

01-22-2009 – Crosley v. Debt Resolution Partners, LLC et al (Class Action Suit)
02-17-2009 – Haidee Estrella v. Freedom Financial Network LLC et al Refiled on 07-13-2009
06-30-2009 – Yunker et al v. Rise Above Debt Relief LLC et al (Exhibits)
07-27-2009 – Wyckoff v. Fresh Start Solutions LLC et al (Exhibits)
08-07-2009 – Carlsen et al v. Global Client Solutions LLC et al
08-17-2009 – Mugno et al v. Freedom Debt Solutions, LLC et al
10-09-2009 – Anthony v. McGuire et al Settlement

So What?

We will just have to wait and see what Global Client Solutions decides to do about continuing to play in the sandbox with the debt settlement folks. Maybe they will decide that the risk just isn’t worth it to them. Probably the suits will continue and accelerate as states and individuals determine that GCS is operating more on the behalf of the debt settlement company, than the consumer.

If you have half a day to kill you can read through all the complaints I have linked for you above. What you will find is a developing pattern of participation by GCS and the debt settlement provider front end entity.

I’m left wondering why GCS doesn’t just abandon servicing the debt settlement industry, is the money they are making off of this just that good? Why would these good guys continue to associate with an industry filled with bad actors and companies of dubious distinction?

@GetOutOfDebtGuy

How to Get Out of Debt With the Get Out of Debt Guy » fdr

We Are With Freedom Financial And Getting Sued. – Anne

The Answer:

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Freedom Debt Relief Looks Forward to Positive Changes from New FTC Rules

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Global Client Solutions & Rocky Mountain Bank & Trust, Good People Tangled in Some Bad Debt Settlement Business

The Slope Gets Slippery Right About Here

So What?

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