Debt Relief Industry

Legal Helpers Debt Resolution Retainer Agreement With Rise Above Debt

Here is a current retainer agreement, as of the date this article published, for Legal Helpers Debt Resolution, LLC, also known as the law firm of Macey, Aleman, Hyslip & Searns, was forwarded to me. I thought you would be interested in reading it to see how at least one law firm is enrolling consumers at this time.

I have bolded interesting parts I found interesting and any additional statements I made.

From reading the agreement I came away with the following observations:

  1. The services are only for unsecured debt.
  2. The law firm does not provide any bankruptcy advice until the situation determines it. I took this to mean that there was no screening of potential clients to signpost them towards bankruptcy initially if it was a better solution.
  3. The service does not eliminate harassment or collection calls from collectors.
  4. The law firm subcontracts out some of the work to a non-attorney debt relief company.
  5. The law firm does not verify the information supplied by the client.
  6. It could be said the law firm interferes in the relationship between the consumer and creditor by saying “If a creditor telephones client, Client will not engage in debt resolution discussions.”
  7. There is no guarantee regarding any outcome. Debts may not be reduced.
  8. The law firm assumes no liability for changes in the law but isn’t staying current with the law what you expect your law firm to do? Just saying.
  9. There is an upfront charge of $500 for something called a debt review.
  10. The client is charged $25 for a bounced EFT which costs the company a nominal amount to process.
  11. Using the law firm does not prevent the client from being sued.
  12. This agreement with the law firm does not contain any legal services or representation.
  13. The agreement says the debt will be reduced at least 35% which means the client could end up owing 65% of the balance.
  14. The services will negatively impact the credit report of the client.


1. Parties and Purposes: This agreement for legal services is entered into on the date shown below between Legal Helpers Debt Resolution, LLC, also know as the law firm of Macey, Aleman, Hyslip & Searns (hereinafter referred to as LHDR) and [X] (hereinafter referred to as Client) relating to advice, counseling, analysis and negotiations services in regard to Client’s unsecured debt and related financial circumstances regarding credit cards and line of credit obligations (unsecured debt). This contract is solely between LHDR, any assigns, or related entities that may be formed in the future and not any individual, partner, member, or employee of LHDR. LHDR is a debt relief agency and law firm that provides debt resolution services to its clients.

2. Condition of Effectiveness: This Agreement does not take effect, and LHDR has no obligation to provide any services, until both the Client and LHDR have executed a copy of this Agreement, delivered such copy to the other party, and the Client makes an initial flat fee retainer payment as provided for in Paragraph VIII.

3. Limited Retention: LHDR will negotiate and attempt to enter into settlements with creditors of the Client in an effort to modify and/or restructure Client’s current unsecured debt. LHDR and its staff will timely respond to all Client inquiries and keep the Client informed as to all offers of debt modification. LHDR’s obligation to negotiate shall only apply to specific unsecured debt obligations as disclosed by the Client. The details of such obligation are included in Schedule A of this Agreement.

LHDR will not and does not provide the following services to Client:

a. Tax, financial planning or accounting advice;
b. Attempt to repair credit or correct entries on credit reports;
c. Any bankruptcy advice, except as specifically provided for below;
d. Represent Client in any matter before a court, including foreclosure proceedings or in any arbitration or hearing; or
e. Eliminate harassment or collection calls from collectors.

In the event a creditor or collector sues Client, whether related to a debt obligation or any other claim, LHDR is under no obligation to provide representation. LHDR will discuss specific debt related issues with Client and, if appropriate, offer additional legal services in regard to bankruptcy or other debt resolution services for Client’s consideration.

4. Term: The term of this agreement shall commence on the effective date and continue until the negotiated resolution of unsecured debt disclosed by Client in Schedule A of this Agreement or until termination of this Agreement as provided in Paragraph XIV.

5. Subcontracting Specific Tasks: LHDR shall subcontract certain tasks including negotiations with creditors and collectors and certain customer support responsibilities to a third party. LHDR and other legally trained, licensed personnel will supervise all negotiations and customer support and ensure that these services comply with established procedures.

6. Client Obligations: The Client will perform the following obligations:

a. Provide LHDR with all information and documents in regard to the unsecured debt it seeks to modify. Such information provided must contain the current account balance and the name of the creditor and account number.

b. Provide LHDR with all information and documents in regard to the unsecured debt it seeks to modify. Such information provided must contain the current account balance and the name of the creditor and account number. As an ongoing obligation, Client will provide all information related to the unsecured debt as requested by LHDR. All information provided by Client must be truthful and accurate. LHDR is under no obligation to verify information supplied by Client. Client will forward all correspondence from creditors, including collection letters, demands and complaints. If a creditor telephones client, Client will not engage in debt resolution discussions. If a creditor engages in harassing or abusive conduct, the Client will promptly notify LHDR and provide complete and accurate information regarding such contacts.

c. Client will timely respond to all requests, communications or documentation from LHDR or its representatives and will promptly provide LHDR with any change of address or other contact information.

d. Subsequent to the execution of this Agreement, Client shall, based on the advice of LHDR, determine and agree to a schedule of monthly payments based on the total amount of debt to be modified, including payment of appropriate fees and costs to LHDR (“Payment Schedule”), a copy of said schedule is attached hereto as Schedule B, incorporated by this reference. Client agrees to make all the payments on the designated dates.

e. Client agrees to timely and fully pay all debt modification negotiated by LHDR and approved by Client.

7. Law Firm’s Obligations: In consideration for Client’s obligations as stated in Section VI, LHDR agrees to use its best efforts to obtain a satisfactory result for Client by providing basic legal services in connection with the debt modification for client on an efficient and cost-effective basis. Client expressly agrees that LHDR makes no specific guarantee regarding the outcome of the case, including but not limited to, successful modification or discharge of debt, and/or whether or not LHDR can successfully reduce the balance of all unsecured debts. LHDR offers its advice based on the information as disclosed by Client and Client agrees that LHDR is not responsible and assumes no liability for changes in the law, changes in Client’s financial situation, and/or facts as revealed after review of documentation that could affect in any way any advice LHDR gives Client. LHDR will adhere to the specific disclosures regarding contingency fees and the minimum performance standards as outlined in the Payment Schedule.

8. Fees and Costs: In consideration for all services to be rendered, Client agrees to pay LHDR an initial flat fee retainer of $500 for debt review, analysis and structuring of a debt resolution plan. In addition, Client shall pay the law firm a monthly maintenance fee/cost for their debt resolution plan in the amount of $39.00 commencing in the first month following the collection of the entire retainer fee of $500.00.

The implementation, management and maintenance of a debt resolution plan by LHDR shall be performed under the direct supervision of LHDR by Rise Above Debt Relief (hereinafter referred to as “RADR”) a cost of 6% of the Client’s total scheduled debt (Service Cost). LHDR has a non-exclusive reciprocal referral agreement with RADR to provide these services directly and through their agents under LHDR’s direct supervision. These are services required for the debt resolution plan, but are not legal services. There is no attorney-client relationship between Client and RADR in regard to these services and any specific communications between client and RADR are not protected by attorney-client privilege. RADR cannot and will not provide any legal advice to the Client other than as communicated through RADR by LHDR and under LHDR’s supervision. The Service Cost shall be paid by Client in equal consecutive monthly payments commencing immediately following the preparation of the debt resolution plan. RADR shall receive from LHDR administrative costs per month from the monthly maintenance fee/cost as outlined above.

Client understands and agrees to set aside an amount as designated by LHDR in a Federal Deposit Insurance Corporation (referred to as “F.D.I.C.”) insured bank account for LHDR to withdraw this Service cost for RADR’s work in the management of the debt resolution plan and for Client to accumulate settlement funds to be used for settlement purposes. Client agrees to have their payments of Service Costs to be automatically drafted by LHDR from an authorized bank account with Client’s first payment to start on [X] and thereafter on the 30 day of each month.

9. Electronic Payment Authorizations: By signing this agreement, Client authorizes LHDR to deduct all legal fees and service costs via electronic payment authorizations from an authorized checking, savings, or other account. LHDR requires a minimum of five (5) business days to change any scheduled Electronic Funds Transfer (“EFT”) from an authorized bank account. Non-sufficient funds “NSF” in Client’s authorized bank account, on Client’s scheduled payment date, is considered a non-payment and there will be a twenty-five dollar ($25) fee automatically charged to Client’s account for any NSF transactions.

10. Client Acknowledgement: Client acknowledges and agrees that:

a. The outcome of LHDR’s negotiation of any specified account entered by Client into the debt negotiation program is uncertain and results may vary;

b. The service provided by LHDR does not include the modification, collection or improvement of Client’s credit reports;

c. LHDR’s debt negotiation may not prevent creditor or collection agency harassment, nor prevent phone calls on behalf of creditors or collection agencies to Client;

d. Client may be sued by creditors or collection agencies and in that event LHDR’s services, pursuant to this agreement, does not include legal representation on those matters;

e. The discharge of indebtedness may be considered a taxable event and Client should consult a tax professional for any such service.

11. Additional Debt: Client should not incur any new or additional debt and should refrain from using or obtaining credit during the LHDR debt resolution representation. Client understands all credit cards and/or lines of credit shall be closed and that no additional credit cards and/or lines of credit should be applied for during the LHDR debt resolution representation. Client understands that they may keep one credit card, not to be accepted in the program, open for emergency purposes only. This credit card should not be from the same issuing bank as any accounts entered by Client into the LHDR debt resolution representation.

12. Debt Resolution Minimum Standards of Representation: LHDR maintains a standard of representation for each individual account entered by Client into the LHDR debt resolution plan, of a minimum of settlement debt reduction of thirty-five percent (35%) of the debt’s current face value, including interest, penalties and late fees. In the event that LHDR does not meet this minimum standard, it shall refund all costs associated with the implementation, management and maintenance of a debt resolution plan, to wit, the 6% Service Fee paid to RADR for such work under the direct supervision of LHDR. This refund is subject to all of the following terms and conditions:

a. Client must act in complete compliance with this agreement and shall cooperate with LHDR under this agreement;

b. Client must not default on any payment obligations under an agreed-upon settlement for any accepted account.

c. If for any reason, Client is unwilling or is unable to accept a proposed settlement on any contracted account with a settlement debt reduction of thirty-five percent (35%) of the debt’s current face value minus fees and costs of this agreement, or Client otherwise fails or refuses to accept any such settlement on any contracted account with a settlement debt reduction of thirty-five percent (35%) of the debt’s current face value, minus fees and costs of this agreement this Limited Guarantee shall be null and void, and have no force or effect;

d. Should LHDR be unable to settle one or more of Client’s individual accounts accepted pursuant to this agreement, any refund shall be calculated on a pro rata basis as to the Service Fees paid to LHDR attributable to such individual unsettled account.

e. This minimum standard provision does not apply to any Client’s individual accounts accepted into the debt resolution plan which have had balance transfers, cash advances, accounts initially accepted with balances fewer than one thousand dollars ($1,000) or where there has been a law suit already filed on such individual account. LHDR will discuss with the Client other legal remedies in the event of such circumstances including Chapter 7 or Chapter 13 bankruptcy.

13. Impact on Credit Rating: Client acknowledges that nonpayment, minimal payments, or settlement payments to creditors may result in derogatory credit information transmitted to the major credit reporting agencies, and in the event that any negative effect is caused to Client’s credit profile. LHDR does not provide debt consolidation services and Client acknowledges herein that it received proper notice regarding possible consequences to the Client’s credit rating.

14. Termination and Severability: Client agrees that both parties may sever the relationship at any time. The party choosing to terminate the agreement will document the decision by sending a 30-day written notice to the other party. The termination will occur upon receipt of such notice. If such termination occurs, the Client shall only be responsible for the fees incurred through the date of cancellation and the initial flat fee retainer. LHDR may cancel this agreement if the Client fails to make two (2) successive monthly payments. If any legal action is brought regarding this agreement, the prevailing party shall be entitled to legal fees and court costs. If LHDR achieves a more favorable settlement so that funds are left over, those funds will be returned to Client after satisfaction of the contingency fee as specified in this agreement.

15. Authorizations: The Client authorizes LHDR as follows:

a. The Client authorizes LHDR to disclose information regarding Client’s financial condition or status to any creditor or collector in regard to the debt resolution plan. Further, LHDR may obtain information concerning Client from such creditors.

b. Client authorizes LHDR to disclose to creditors and collectors that LHDR and its representatives, or subcontractors, are authorized to negotiate debt resolution terms on behalf of Client.

c. Client authorizes LHDR to negotiate and modify the unsecured debt listed in Schedule A of this Agreement.

16. Confidentiality: LHDR agrees that any information provided by Client will be kept confidential and only be used in providing the negotiation and modification services described in this Agreement.

17. Disclosures and Disclaimers: Client acknowledges and understands that LHDR will not agree to provide the services under this Agreement absent Client’s full understanding and acceptance of the basis for the work to be performed. LHDR and its agents and representatives provide services related to the modification and restructure of the Client’s unsecured debt. LHDR cannot and does not make any guarantee of any kind regarding the success of any negotiation in regard to such modification. Client acknowledges that each case is unique and that results may vary.

Client understands that there are other remedies available in regard to their goal of debt resolution including consumer credit counseling and bankruptcy. (See Exhibit A of this Agreement for further information).

Consumer Credit Counseling may impact less on the Client’s credit rating and reduce interest rates on current debt, but generally will require payment of the majority of the Client’s existing debt. Bankruptcy may discharge the majority of Client’s debts, however Client has requested LHDR to pursue other alternatives at this time to avoid bankruptcy. LHDR will discuss and advise Client as to the bankruptcy option, including fees and costs, at any time that Client’s circumstances change or Client requests such consultation. There are no additional fees or costs required from Client for such consultation and advice regarding bankruptcy. In the event that the Client elects to pursue a bankruptcy option in the future with LHDR, a full disclosure regarding fees shall be given including any credits or pro rata reduction in fees based on LHDR’s representation of the Client pursuant to this Agreement.

18. Arbitration: In the event of any claim or dispute between Client and LHDR related to the Agreement or related to any performance of any services related to this Agreement, such claim or dispute shall be submitted to binding arbitration upon the request of either party upon the service of that request. The parties shall initially agree on a single arbitrator to resolve the dispute. The matter may be arbitrated either by the Judicial Arbitration Mediation Service or American Arbitration Association, as mutually agreed upon by the parties or selected by the party filing the claim. The arbitration shall be conducted in either the county in which Client resides, or the closest metropolitan county. Any decision of the arbitrator shall be final and may be entered into any judgment in any court of competence jurisdiction. The conduct of the arbitration shall be subject to the then current rules of the arbitration service. The costs of arbitration, excluding legal fees, will be split equally or be born by the losing party, as determined by the arbitrator shall decide. The parties shall bear their own legal fees.

19. Integration: This Agreement and all schedules are the complete and exclusive statement of the Agreement of the parties and supersede any proposal, prior agreement, oral or written, and any other communication related to this matter.

20. Enforceability: In the event that any portion of this Agreement is determined to be illegal or unenforceable, the determination will not affect the validity or enforceability of the remaining provisions of this Agreement, all of which shall remain in full force and effect. The parties agree to insert another provision that will be valid to come in closest to the original intent of the Agreement.

21. Amendment: This Agreement may be modified by a subsequent agreement by the parties only by an instrument in writing, signed by both LHDR and Client and no waiver of any provision or condition of this Agreement shall be effective or binding unless such waiver be in writing and signed by the party claiming to have given such waiver.

Exhibit A
Disclosure and Election of Services

LHDR is a full service debt resolution law firm including debt negotiation and restructuring, bankruptcy services and where appropriate referral to consumer credit counseling agencies. The following provides information as to all these approaches to debt resolution for your review. Clients should fully understand the advantages and disadvantages of each to make an informed decision.

Credit Counseling offers services that will allow you to work with a certified credit counselor to devise a plan that is tailored to your specific needs and goals. Credit counseling agencies often provide services for free and will help to educate you about how to avoid financial problems in the future by offering debt management classes or seminars. They do not erase your debt. Instead they work with you to budget money so that you can pay off the debt often times by debt consolidation. Collections by your creditors may continue while using a credit counselor and most plans require you to pay your entire debt balance over the life of the plan. Consumer credit counseling agencies are required to advise you that they are compensated by the creditors based on the amount of debt they are able to have you pay.

Bankruptcy will usually discharge your unsecured debt and your creditors are not permitted to contact you once you have filed with the court. There are two kinds of bankruptcy; Chapter 13 bankruptcy where you are generally able to keep property that is mortgaged such as your house or car and are expected to repay debts in three to five years and Chapter 7 bankruptcy where you must give up all non-exempt property and assets that you own in exchange for a discharge of most debt. Bankruptcy may be appropriate if you have pending foreclosures, collection litigation or wage garnishments, however, you will generally be unable to establish credit for up to ten years. [Not True!] In 2005, the bankruptcy law was changed to make it more difficult for some consumers to file Chapter 7 bankruptcy based on a financial means test and credit counseling requirements that may require a repayment of some of your debt. [What is the purpose of this statement? Is it a history lesson?]

Debt Negotiation is a process where the law firm, based on your specific circumstances, develops a plan to manage your debt resolution with your creditors. In general terms, it is a process of negotiating with your creditors for a lower balance/forgiveness of debt, a reduced interest rate, a reduced monthly payment or other restructuring alternatives. To be successful in debt negotiation, you need to have sufficient cash flow to meet your living expenses each month and provide some funds towards resolution of your debt.

LHDR will contact all your unsecured creditors in writing that you are represented by the law firm and that we are advising you as to all alternatives for debt resolution. As you have indicated in your compliance review, you prefer LHDR to attempt debt negotiation as an alternative to bankruptcy. However, if your financial circumstances change, we will advise you as to other debt resolution alternatives outlined above, so you can make an informed decision based on our advice. [Totally skips over the risks associated with debt settlement unlike in the description of credit counseling or bankruptcy.]

If you have any questions regarding the above options, please contact us for further explanation. If you are ready to proceed, sign below your acknowledgement that you have reviewed all possible debt resolution options and have determined that debt negotiation by LHDR is your preference, subject to your ability to request a different alternative if your circumstances change in the future. Please review Section XVII of this Agreement prior to executing your informed consent below.

I have reviewed all debt resolution options available to me including bankruptcy and consumer credit counseling and elect to pursue debt negotiation services with LHDR, subject to my ability to request other alternatives, based on changes in my financial circumstances.

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READ  It Begins. Illinois AG Sues Legal Helpers Debt Resolution.

About the author

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.

30 Comments

  • So – how do I get out of a contract with them and recover my money from the past 6 months?

  • You bring up a great point Robert. Alot of the fly by night definitely inflated cost. I strongly believe that most of the issues caused by some of these crooked lead generators aswell. They basically knew to draw a consumer in by shady tactics and false advertisement. I am sure for any business owner your main focus is traffic and if a marketer was willing to risk the advertisement than it was on them. That’s not the case now so everyone is involved so this is going to be interesting. I just hate the fact the industry is full shady schemes and taking away the focus on how to really resolve a consumers debt problems but the attention is on how to stay away from companies.

  • Actually Joe, we agree. Because I think the old model was flawed as well. The up-front fees inflated the marketing cost because more and more “fly-by-night companies” sprung up. (forcing companies to need to justify the upfront fees).

    If anyone in the debt industry will tell ya, lead cost have dropped dramatically. simple economics. no Up-front-fees. Less companies. Lower cost…. this should lead to a profitable business in Debt Settlement with Pay as you settle.

    I will note, I think there should be some reasonable fee prior to settlement. I don’t know the exact number, but something very nominal that covers the companies cost to service clients prior to settlement. Using the analogy of a real estate agent and commission isn’t very comparable. Real estate agents have very little overhead when it comes to marketing a home. Most of the marketing involves placing the home on the MLS @ the right price… but this is another discussion.

    … Either way, I am againast the old model of high up front fees. I like the performance based, but as it stands today a company can in its good faith negotiate a settlement for the client… client can decide to NOT make the first payment, and the company gets 0. What will this do? Raise the price for clients who stick through the program. Shop some companies now… the prices have gone up, though we won’t know how long this will last as the industry finds its profitable point.

  • Not true Ocbrokerguy, I many friends in the debt settlement business and they confused as to how to continue their career in the business and trying to find out all the correct facts so this way they too don’t break any laws. Everything on that has been written about the debt settlement biz has been pointers as to why it is wrong but only a few is explaining the right way of doing it. If you think about it, if you really in the business to help the consumers to get rid of their debts than you will do everything in your powers to do it right. So if the majority vote is saying the old model is wrong than its wrong so lets do it the right way and move on. I can’t speak for CCCs people because they generally don’t get compaints about them taking such large upfront fees and not provide a result. There’s a program fit for each individuals so it is best to really analysis which is which before making that final recommendations to move forward.

  • So will the new Post 10-27 offer legal services? And yea… people on this board are inherently against debt settlement. They will say “no, we’re against deceptive companies” but every single example will start with the conclusion that debt settlement companies are inherently corrupt.

    Wonder if a lot of people work for CCC, or other related areas…

  • thanks for clearing that up JD, sounds like the original version of LHDR contracts. I am curious to learn about his face to face meeting. Are you saying that every client that enrolls into the debt settlement plan will be meeting with an attorney in their state? Is the attorney that is meeting up with the client going to have the client sign a service agreement or the reps selling the deal going to have client sign the retainer? Since there is no more upfront fees so does that mean you are planning change the setup fee and call it a “Consultation Fee” and charge a higher retainer or is it still going to be $500?

  • Obviously, you guys have no idea what you are talking about, so let me get the facts correct for you since I am the President/CFO of Rise Above Debt Relief.

    Currently we enroll consumers as follows:

    1. The contract is with Legal Helpers Debt Resolution Law firm, $500 to the attorney group, financed up to 4 months.
    2. Monthly maintenance fee is only $39 per month until done with program, no early termination penalty.
    3. And, a 13% fee of enrolled debt which is financed between 12-24 months depending on the program length and payment needed.
    4. ALL creditors are contacted IMMEDIATELY with a letter of representation and instructed to route all calls and correspondence to our office. This does not eliminate initial creditor harassment, but it reduces it signficantly and is very powerful with 3rd party collectors.

    We negotiated with GCS to NOT charge the client the $25 NSF fee, so there is no charge there which happens quite often.

    Performance Guarantee, if we don’t save them at least 35% off of the original balance, we do not charge for working that debt. Our average for the last year has been 62% savings! That is .38 cents for every $1 owed.

    Add the fees to the .38 cents average settlements, and the clients eliminate their debt for about .57 cents on the dollar. Done. And that typically happens over a 30-48 month period. Much better than the 27-35 year payback period most credit cards have at a minimum payment with 15-30% interest.

    BUT, that contract will no longer be used in one month as we are revising the procedures to be FTC compliant.

    So rant and rave all you want over this contract, it will be outdated shortly anyway, and a new and improved version will be coming that we will be happy to share with you upon request. ALL clients will receive a face-to-face meeting with an attorney, and it will be a much improved program with the new enhancements being put into place.

    Thanks for your time, and have a great day.

  • Obviously, you guys have no idea what you are talking about, so let me get the facts correct for you since I am the President/CFO of Rise Above Debt Relief.

    Currently we enroll consumers as follows:

    1. The contract is with Legal Helpers Debt Resolution Law firm, $500 to the attorney group, financed up to 4 months.
    2. Monthly maintenance fee is only $39 per month until done with program, no early termination penalty.
    3. And, a 13% fee of enrolled debt which is financed between 12-24 months depending on the program length and payment needed.
    4. ALL creditors are contacted IMMEDIATELY with a letter of representation and instructed to route all calls and correspondence to our office. This does not eliminate initial creditor harassment, but it reduces it signficantly and is very powerful with 3rd party collectors.

    We negotiated with GCS to NOT charge the client the $25 NSF fee, so there is no charge there which happens quite often.

    Performance Guarantee, if we don’t save them at least 35% off of the original balance, we do not charge for working that debt. Our average for the last year has been 62% savings! That is .38 cents for every $1 owed.

    Add the fees to the .38 cents average settlements, and the clients eliminate their debt for about .57 cents on the dollar. Done. And that typically happens over a 30-48 month period. Much better than the 27-35 year payback period most credit cards have at a minimum payment with 15-30% interest.

    BUT, that contract will no longer be used in one month as we are revising the procedures to be FTC compliant.

    So rant and rave all you want over this contract, it will be outdated shortly anyway, and a new and improved version will be coming that we will be happy to share with you upon request. ALL clients will receive a face-to-face meeting with an attorney, and it will be a much improved program with the new enhancements being put into place.

    Thanks for your time, and have a great day.

    • thanks for clearing that up JD, sounds like the original version of LHDR contracts. I am curious to learn about his face to face meeting. Are you saying that every client that enrolls into the debt settlement plan will be meeting with an attorney in their state? Is the attorney that is meeting up with the client going to have the client sign a service agreement or the reps selling the deal going to have client sign the retainer? Since there is no more upfront fees so does that mean you are planning change the setup fee and call it a “Consultation Fee” and charge a higher retainer or is it still going to be $500?

    • So will the new Post 10-27 offer legal services? And yea… people on this board are inherently against debt settlement. They will say “no, we’re against deceptive companies” but every single example will start with the conclusion that debt settlement companies are inherently corrupt.

      Wonder if a lot of people work for CCC, or other related areas…

      • Not true Ocbrokerguy, I many friends in the debt settlement business and they confused as to how to continue their career in the business and trying to find out all the correct facts so this way they too don’t break any laws. Everything on that has been written about the debt settlement biz has been pointers as to why it is wrong but only a few is explaining the right way of doing it. If you think about it, if you really in the business to help the consumers to get rid of their debts than you will do everything in your powers to do it right. So if the majority vote is saying the old model is wrong than its wrong so lets do it the right way and move on. I can’t speak for CCCs people because they generally don’t get compaints about them taking such large upfront fees and not provide a result. There’s a program fit for each individuals so it is best to really analysis which is which before making that final recommendations to move forward.

        • Actually Joe, we agree. Because I think the old model was flawed as well. The up-front fees inflated the marketing cost because more and more “fly-by-night companies” sprung up. (forcing companies to need to justify the upfront fees).

          If anyone in the debt industry will tell ya, lead cost have dropped dramatically. simple economics. no Up-front-fees. Less companies. Lower cost…. this should lead to a profitable business in Debt Settlement with Pay as you settle.

          I will note, I think there should be some reasonable fee prior to settlement. I don’t know the exact number, but something very nominal that covers the companies cost to service clients prior to settlement. Using the analogy of a real estate agent and commission isn’t very comparable. Real estate agents have very little overhead when it comes to marketing a home. Most of the marketing involves placing the home on the MLS @ the right price… but this is another discussion.

          … Either way, I am againast the old model of high up front fees. I like the performance based, but as it stands today a company can in its good faith negotiate a settlement for the client… client can decide to NOT make the first payment, and the company gets 0. What will this do? Raise the price for clients who stick through the program. Shop some companies now… the prices have gone up, though we won’t know how long this will last as the industry finds its profitable point.

          • You bring up a great point Robert. Alot of the fly by night definitely inflated cost. I strongly believe that most of the issues caused by some of these crooked lead generators aswell. They basically knew to draw a consumer in by shady tactics and false advertisement. I am sure for any business owner your main focus is traffic and if a marketer was willing to risk the advertisement than it was on them. That’s not the case now so everyone is involved so this is going to be interesting. I just hate the fact the industry is full shady schemes and taking away the focus on how to really resolve a consumers debt problems but the attention is on how to stay away from companies.

  • It says the 6% fee is paid from the monthly!!! So…. 154 months on $100k… Legal Helpers is a bigger company… I guess i shouldnt be suprised by their arrogance or desire to make $ at any cost to the industry & consumer… But…. Whatever- $16k per violation! Hmmmmmmmm

  • I’m having trouble understanding their fees also, not sure how Joe Consumer is supposed to understand it.

    To me it looks like LHDR will charge a $500/retainer up front and once thats paid they will charge $39 a month.

    The 6% of the enrolled debt looks like it goes to the back-end RADR, but it’s not clear on when and how that is charged.

  • Sadly- It doesn’t come close to being compliant! I suppose they are seeing what they want to see. What really kills me is the self- savings basis. It is barely mentioned & not in so many words! I guess they assume the client will know they need to save money for their settlements but how many clients actually will? This seems to be a way to charge their monthly fee on & on in the cases when clients do not have the funds available.
    Andy- Is it me? or is this correct? Looks like they charge 6% and it’s paid to the processor (?) out of the monthly maintenance fee? If thats true, a $100k debt… Fee is $6k Divided by $39 = 154 months!!!!!! WHAT???

  • I’m thinking the same thing Sean. How the hell is this compliant with the TSR?

    I guess they believe by calling it a “retainer” it will be allowed. I’m curious to see how this works out for them.

    As more and more DSCs switch to a true compliant model, models like this will soon be outpriced, outserviced, outsold, and outperformed. If regulators don’t catch up with them, competition surely will.

  • I’m thinking the same thing Sean. How the hell is this compliant with the TSR?

    I guess they believe by calling it a “retainer” it will be allowed. I’m curious to see how this works out for them.

    As more and more DSCs switch to a true compliant model, models like this will soon be outpriced, outserviced, outsold, and outperformed. If regulators don’t catch up with them, competition surely will.

    • Sadly- It doesn’t come close to being compliant! I suppose they are seeing what they want to see. What really kills me is the self- savings basis. It is barely mentioned & not in so many words! I guess they assume the client will know they need to save money for their settlements but how many clients actually will? This seems to be a way to charge their monthly fee on & on in the cases when clients do not have the funds available.
      Andy- Is it me? or is this correct? Looks like they charge 6% and it’s paid to the processor (?) out of the monthly maintenance fee? If thats true, a $100k debt… Fee is $6k Divided by $39 = 154 months!!!!!! WHAT???

      • I’m having trouble understanding their fees also, not sure how Joe Consumer is supposed to understand it.

        To me it looks like LHDR will charge a $500/retainer up front and once thats paid they will charge $39 a month.

        The 6% of the enrolled debt looks like it goes to the back-end RADR, but it’s not clear on when and how that is charged.

        • It says the 6% fee is paid from the monthly!!! So…. 154 months on $100k… Legal Helpers is a bigger company… I guess i shouldnt be suprised by their arrogance or desire to make $ at any cost to the industry & consumer… But…. Whatever- $16k per violation! Hmmmmmmmm

  • I have a few comments….
    1- Hahahaha
    2- Does NOT comply with TSR edit for 10-27, See Definition of Debt Settlement- That it charges fees whether or not debts are settled and theyre charged up front.
    3- It’s a SELF-SAVINGS plan. If they have a settlement offer of 15% and client has no money saved… Too bad????, Keep charging monthly fee forever?
    4- Guarantee of 65% settlement is based on ENROLLED debt! Not debt at time of settlement (should be an easy target to hit)
    5- 6% is taken from mo maint???? Thats 75 months on a 50k debt! at $39 mo

  • I have a few comments….
    1- Hahahaha
    2- Does NOT comply with TSR edit for 10-27, See Definition of Debt Settlement- That it charges fees whether or not debts are settled and theyre charged up front.
    3- It’s a SELF-SAVINGS plan. If they have a settlement offer of 15% and client has no money saved… Too bad????, Keep charging monthly fee forever?
    4- Guarantee of 65% settlement is based on ENROLLED debt! Not debt at time of settlement (should be an easy target to hit)
    5- 6% is taken from mo maint???? Thats 75 months on a 50k debt! at $39 mo

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