Debt Settlement President Says My Debt Settlement Refund Process is Like Dropping a Nuclear Bomb

Not that long ago I wrote an article about how to get a refund from a debt settlement program.

I’ve already heard back from some readers that have used the process effectively but I wanted to ask a debt settlement company leader I know if he thought the process would be effective for consumers. I love this quote from his response:

The steps listed in How to Get Out of a Debt Settlement Program and Get a Big Refund should represent a consumer dropping a “nuclear bomb” on any business.

Debt Settlement Company Says This About My Refund Process

“In reading How to Get Out of a Debt Settlement Program and Get a Big Refund I realized that I may have some valuable insight for those seeking a refund from a debt settlement company.

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You see, I own and closely operate a debt settlement company that survives on performing for our clients, if we don’t perform we don’t get paid, it’s as simple as that. We have no issues with refunds, because we don’t charge upfront fees. Yes, from time to time we have had an unhappy client , but I couldn’t ever imagine an issue so large that it wouldn’t be handled internally, within one or two phone conversations.

As of October 27 2010 the FTC’s new Telemarketing Sales Rule (TSR) will put an end to upfront fees in the debt settlement industry. This will draw a very clear line in the sand. The companies that expect to survive will embrace these new rules and strive for compliance right away. The companies that are either too large or unwilling to conform, will undoubtedly close down, taking the cash of all their unfortunate clients with them.

In reading the article the author is going on the premise that someone is already enrolled in a debt settlement program and they want out. The steps listed in How to Get Out of a Debt Settlement Program and Get a Big Refund should represent a consumer dropping a “nuclear bomb” on any business. I believe that any responsible owner of any legitimate business would be extremely concerned if a client were taking the steps outlined in this article.

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I also want to believe that even just the threat of being reported to regulatory agencies, would be motivation enough for a respectable business owner to address the problem and offer a fair refund or compensation of services. Unfortunately, that is not the case in debt settlement right now and many in the industry don’t care about negative press or heat from regulators. They only want to pocket as much cash as they can, close shop, and then move on to the next industry to plunder.

If the company in question has any intention of staying in business, they will have already began preparing a business model that does not survive on upfront fees. Ask the company to switch you to a performance based fee structure, and stop charging you any fees until they have settled at least the corresponding amount of your debt, in relation to the fees you have already paid. If the company refuses to adjust your contract in a fair way, you will want to begin the process of requesting a refund immediately, before they go out of business.

If I had to make one simple adjustment on the steps listed to achieve a refund, it would be to start the process of filing a suit in small claims court much earlier. In fact, I would do it as soon as verbal communication breaks down or the refund is denied. A summons to appear in court would be very hard to ignore, and will usually land on the desk of somebody important. I find it very unlikely that any upfront fee debt settlement agreement would hold up very long in court, and the debt settlement company should know that, if they have any sense of reality. Your goal is to have the company write you a refund check, and avoiding a lawsuit may be the motivation you need to provide.

Even taking all of the steps outlined, the truth remains that many people will never see a refund if the company folds up with nothing left in assets. If concerned about your involvement in any debt settlement program it would be best to start asking all the questions now, for an indication of what the future may hold. It should become very clear, very fast as to what side of the line in the sand they have chosen.”

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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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