I’m Working With Americor Financial But Getting Sued by American Express and First National Bank

Question:

Dear Steve,

I signed up with Americor Financial (Irvine, CA) to help me settle my credit card debt with three creditors.

I make monthly payments to them they hold to use to settle accounts and draw their 20% fee.

One of the Chase accounts has been settled, one is still unsettled.

I am currently being sued by lawyers for two creditors. AMEX and First National Bank. Americor tells me they expect to be able to settle before the trial dates.

Has anybody here had any experience with Americor? What can I expect? Other than just wait for Americor to settle these accounts, what other options do I have?

Gary

Answer:

Dear Gary,

When you opt for a debt settlement approach you typically are unable to pay the debts or you voluntarily default on the debts to get your accounts to a delinquent point where the creditor is more likely to settle.

Can you be sued? Sure. Can you lose and have your wages garnished? Yes. Will this negatively impact your credit report? You bet.

These consequences don’t make settlement the wrong solution for you but it does reinforce that settlement is a tool best utilized when the consumer has been educated and informed about the potential issues.

If you want to see what the end results of the Americor Financial program might be I would urge you to read your client agreement you signed when you purchased their services. Those typically paint a different picture than that delivered by the salesperson. And that agreement describes the service you actually purchased.

It’s not clear from your question if you are asking about options other than settlement. But options like bankruptcy would prevent you from being the subject of legal activity and eliminate your debt tax-free.

You will absolutely have to attempt to find a good solution with Americor if you want to stay in the program.

I don’t know if Americor has worked out some solution with creditors like American Express. They are a difficult creditor and one that has a history of not working with debt settlement companies.

During the suit by the Consumer Financial Protection Bureau, it was disclosed “in 2015, Freedom requested an in-person meeting with American Express. Freedom representatives met with American Express representatives in the summer of 2015 in an effort to have American Express reverse its policy against negotiating with debt-settlement companies. Freedom did not succeed, and American Express’s policy remained unchanged.” – Source

It later was revealed, “Defendant Housser testified that he was aware of certain creditors that had taken the position that they would not negotiate with debt-settlement companies, including Chase, Macy’s, American Express, and maybe Discover.”

A prudent plan of action may just be to go back to Americor Financial and ask for some data that can shed light on how often they are able to settle with American Express and First National Bank. If they are not willing to provide official details on their success rate with these creditors then you will need to evaluate what are the next steps to take, including hoping they settle before trial.

Steve Rhode Debt Coach and Author

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.

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