Let’s Play “Do They Comply” With Premier Debt Solvers

Here is the ad I saw and I clicked on the chat button. The advertisement says Debt Relief America and they’ve been on Oprah, MSN, Today, CNN Money, and Yahoo. The company that answered the chat request was Premier Debt Solvers and they are the first company to play my new game, “Do They Comply?

I’m going to point out some facts from the chat but I don’t want to take anything out of context so I’ve posted the entire chat session below for you to read.

Sales Representative says:

  • Debt settlement program is the result of bailout. “ok basically the creditors are an unregulated business. they can raise rates on you, close your acct. at anytime. so what president obama did was pass various stimulous acts that makes it easier for clients going through a financial hardship to be approved for debt relief program”
  • They will settle my debt for 40% of the balance. “we have a team of debt arbitrators that negotiate with your creditors to settle your debt for 40% of what you owe.”
  • Fee for program is 15% paid during first half of program. “fees are taken out thought half of the program”
  • The up-front fee model is better for consumers because when they switch their fee is going to go from 15% of debt to 35% of savings. “i know we are charging 35% of saving”
  • They are licensed to do business but not licensed in Texas where I said I lived and they don’t have to be.
  • The program helps to restore my credit because it reduces my debt. “the only way the program help to restore your credit is in the end when we settle with your creditors, its not the program that helps restore your credit its the natural effect of fico. When you settle your debt your debt to income ratio goes down so that improves your credit”
  • I need to stop paying my creditors. “legally i cant tell you not to pay your creditors, but if your in a financial hardship its doesnt make sence to deposit money in the trust account for settlement and pay them”
  • They only enroll credit cards they have success with. “we only enroll cards that we previously had success settling with”
  • They will settle all of my debt. “based on our estimates and results all of it”
  • The reason they were kicked out of the BBB (source) is because the BBB does not like debt settlement companies. “you cant judge a company just on a bbb rating, especially not a debt settlement company, the industry is unfairly scrutinized by the bbb.”
  • The company is owned by attorney Michael Lupolover out of New Jersey.
  • Attorney run company is paying for debt settlement leads. “because we buy leads from diff vendors”
  • On October 27, 2010 they will change to a performance based model that will be more expensive. Does not mention it until asked. “yes we are changing our model to the saving model”, “as of today we only have one model, fees are taken out thought half of the program”

So, what do you think, Do They Comply? Vote now and post a comment supporting why you think they do or don’t comply.

Vote Now

[poll id=”703″]

The chat link went to http://messenger.providesupport.com/messenger/premierdebtsolvers.html

Bob:
Can you really help me out of debt in 36 months or is this just another scam I’ve heard about?

Call accepted by operator John. Currently in room: Bob, John.

John: no sir this is certainly not a scam
John: we are one the largest debt settlement companies in the country

Bob: If it’s not a loan, how you help then
Bob: How does the credit card bailout work?

John: we have a team of debt arbitrators that negotiate with your creditors to settle your debt for 40% of what you owe.. We give the consumer 55% and take a 15% service charge
John: we then customize a payment plan that fits your budget
John: to get you debt free

Bob: Is this part of the government bailout stuff that Obama passed in the last year? I missed it. Glad I found you now.

John: sir it would be so much easier to explain this to you over the phone. Is it ok if i give you a call?

Bob: No. At work.

John: anytime later tonight?
John: Im just in the middle of a consultation and would love to devote some time to you later

Bob: OK then. I’ll move on to someone that can help me now. Bye.
Bob: Oh, who are you guys?

John: hold on bob just give me 2 minutes ill help you
John: premier debt solvers

Bob: OK

John: ok basically the creditors are an unregulated business. they can raise rates on you, close your acct. at anytime. so what president obama did was pass various stimulous acts that makes it easier for clients going through a financial hardship to be approved for debt relief program
John: And thats exactly what this is a debt settlement
John: program

Bob: OK, makes sense. Glad he passed it. I have $120,000 of credit card debt. You said your program costs 15% so does that mean I have to pay you $18,000 for you to get started now?
Bob: I don’t have $18,000 to pay right now.

John: no sir our fee is factored into your monthly payments throughout your program
John: what state are you located in ?

Bob: I’m from Texas but on a trip at a client site at the moment.
Bob: Why does the site say Debt Relief America and you say you are premier debt solvers? Odd.

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John: because we buy leads from diff vendors
John: that site is not ours

Bob: Oh.
Bob: Does interest stop and how this hurt my credit

John: you will become delinquent on your accounts, we cant settle with your creditors if you are current

Bob: How about my credit then. Will the program help restore it?

John: interest does not stop with the creditors, but we have encountered that into our payments that we are giving you and we dont charge interest
John: what is your credit now

Bob: its 720 but im just making minimum payments and not sure how much longer i can continue

John: the only way the program help to restore your credit is in the end when we settle with your creditors, its not the program that helps restore your credit its the natural effect of fico. When you settle your debt your debt to income ratio goes down so that improves your credit
John: credit goes does down because of couple of factors
John: owing more than 50% of your limit
John: even without being late your score will go down
John: if your over 505 of your limit
John: 50%

Bob: Do I pay each month or when you settle the debt? How do I know you’ll actually settle the debt?

John: if you go to our site www.premierdebtsolvers.com
John: we do have our previous settlements
John: legally i cant tell you not to pay your creditors, but if your in a financial hardship its doesnt make sence to deposit money in the trust account for settlement and pay them
John: like i said before we cant settle when you are current with them
John: logically doesn’t make sense for them

Bob: How do I know if you can really settle all of my credit card debt or those letters are just some accounts you did settle. What percentage of my debt are you going to settle for $18,000 of my kids college fund?

John: we doent settle student loans

Bob: I don’t have student loans

John: we only enroll cards that we previously had success settling with

Bob: I have Citibank, Bank of America, Chase. Those should be ones you work with all the time

John: yes we do

Bob: So for a big fee you should be able to give me some sort of assurance you can settle all my debt or why pay you 18000

John: chase had been a pain lately , but we are still averaging 39% with them
John: sir let me ask you a question
John: have you ever been to the doctor?
John: and you have an illness

Bob: ok ill play along. yes

John: im giving you an example
John: and he prescribes you medicine correct
John: does he guarantee you that you will be healthy after his medicine?
John: or does he go of his past results and experience
John: thats what we do
John: we go off our past results and exp

Bob: No but if I break my leg and the doctor fixes broken lega, is an expert, he can tell me with some certainty that my leg will heal based on his expertise. So how much of my debt will you settle based on your expertise?

John: yes
John: we go of our expertise

Bob: So how much of my debt will you settle bassed on your experience?

John: thats why we are offering you the numbers

Bob: And the number is…..

John: we will settle with based on 40%
John: since you have a big debt
John: we can reduce our fee to 10%

Bob: I know that. I’m asking how much of my debt will you settle, all of it, some of it, 10% of it. Will my debt be done and gone when I finish your program?

John: so now our fee will become 12k
John: based on our estimates and results all of it
John: why would we than be in business we can only handle 10% of it
John: *if we can
John: again im going of our previous estimates and results

Bob: While I’m killing time here at the support desk I looked you guys up and can you help me to understand why the BBB revoked you guys. It says “this company’s accreditation in BBB was revoked by BBB’s Board of Directors due to failure to maintain minimum BBB Rating.” That’s not good.
Bob: I want to avoid being scammed.

John: you cant judge a company just on a bbb rating, especially not a debt settlement company, the industry is unfairly scrutinized by the bbb. Also premier debt solvers is owned and operated by an attorney

Bob: Client walked in. sorry. I’m back

John: we dont have any outstanding complaints
John: its ok Bob

Bob: An attorney, that’s good. Whose the attorney? Is he in Texas?

John: No he is in New Jersey

Bob: Who is it? I’d like to know the guy that’s going to represent me then.

John: He is not going to represent you sir, like i said before he only owns the company

Bob: OK, now you’ve got me curious who he is and why you won’t tell me who is is even if I’m giving you $12,000. Fishy.

John: Sir i have no reasons to hide anything, if you want you can call and the attorney that owns the company will speak to you gladly

Bob: OK, who is he then and what’s the number?

John: his name is Michael , the office number is 1877-857-6583 ask for him
John: he will give you all his credentials

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Bob: Seriously, no last name? LOL

John: lupolover

Bob: Or do you not know his name?
Bob: OK, thank you.

John: i hope i disclosed everything

Bob: According to this Fox news article today I pay the fee after you settle my debt. Is that correct? http://www.foxbusiness.com/personal-finance/2010/10/13/ftc-issues-final-rules-protect-consumers-credit-card-debt/
Bob: On Oct. 27, debt-relief companies are prohibited from collecting a fee upfront. Under this provision, the company must successfully settle or negotiate at least one of the consumer’s debts and the consumer must make at least one payment to the creditor before any fees are paid.

John: and you understood everything
John: yes we are changing our model to the saving model
John: on oct 27 sir

Bob: So I should wait till then

John: if you would like

Bob: Wouldn’t you?

John: its up to you sir, the only diff is that we collect when we settle
John: that doesnt not change your payment
John: you have the same office working on negotiating your debt
John: and your debt will be paid of faster
John: in the saving model
John: i know we are charging 35% of saving
John: so the fee might be larger that it is today
John: i am not sure

Bob: That’s a big difference though. You originally said I’d have to pay the fee monthly but if you guys are going to start collecting the fee after you actually settle the debt that’s a better deal for me.

John: its not finalized
John: i guess so
John: its better for the cunsomer
John: consumer
John: in a way

Bob: I guess if you are guaranteeing you’ll settle all my debt as you said then paying it up front is cheaper.

John: again i am not guaranteeing i am going of our previous results
John: and we dont enroll any cards that we have previously not settled

Bob: You already said you’ve settled my creditors.

John: what i can guarantee is excellent serivce sir
John: we have settled those cards
John: and we are enrolling them as of today
John: you have 30 day notice of cancellation with us
John: if you are nto happy
John: *not

Bob: So I can sign up now and pay the fee when you settle without having to pay anything now? That’s a good deal.
Bob: Can you help me with bankruptcy if I decide to do that?

John: as of today we only have one model, fees are taken out thought half of the program
John: on the 27 we will the saving model and fees will only be taken out when we settle
John: yes we can
John: if you would like
John: the choice is yours sir

Bob: As I said before, I live in Texas. I just checked with the state site and it says Premier Debt Solvers is not authorized or licensed to do business in Texas. Why not?
Bob: Business Name premier debt solvers was not found.

John: we can refer to an attorney in texas for bankruptcy
John: as of today the state of Texas does not require debt settlement companies to have an attorney in that state of Texas, to practice debt settlement
John: some states do
John: not texas

Bob: But the state requires companies doing business in the state to be licensed in that state even if they are not located there.

John: their are 2 models in debt settlement , red and green
John: Red states require an attorney to negotiate on the debt
John: green states dont require
John: texas is a green state

Bob:
“Transacting Business in Texas: A foreign entity that is transacting business in Texas must file an application for registration with the Texas Secretary of State.”
Bob: http://www.sos.state.tx.us/corp/foreign_outofstate.shtml

John: maybe they mean foreign as out of the country
John: we are in compliance with the industry sit
John: sir
John: i hope i answered all your questions

Bob:
Seriously? Out of the country? Actually that’s not what they mean.

John: i am in the enrollment department sir

Bob: I am in the potential client department

John: i gave the number to our office, you can speak to the attorney to go into this deep details
John: i dont know all of these deep details
John: i am being very up front with you sir

Bob: Why would I want to do that when you are representing the company to me and selling me a $12,000 service you’d think you’d be up on this stuff. Otherwise, are you a doctor or a quack?

John: sir i am sorry but i answered as much as i can
John: if you want you can provide with your contact info
John: and i can have our senior manager call you
John: he knows these details better than me

Bob: That’s OK, I think I’ve had all I can take. – Source

Sincerly,


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

Damon Day - Pro Debt Coach

69 thoughts on “Let’s Play “Do They Comply” With Premier Debt Solvers”

  1. Thanks for all the information, I studied all of it carefully.

    Regarding the exception mentioned above of “(9) transacting business in interstate commerce;”, if that exception cannot be used by an out-of-state corporation selling debt settlement services to TX consumers, then do you have any idea in what type of situation that exception could that be used?

    Reply
  2. David,

    Excellent question and on first glance someone might think the phrase ” transacting business in interstate commerce” gives them a pass. They’d be wrong.

    It’s not that simple and every business should error on the side of registration. This Texas document might help understand the complexity of the issue.

    On top of all of that, “The level of a foreign entity’s activity in Texas that subjects it to franchise taxes is lower than the level of activity that subjects it to registration requirements. An entity that is doing business in Texas for purposes of franchise taxes may not necessarily be “transacting business” in Texas for purposes of registration with the secretary of state.” They’d still need to register for franchise tax.

    Now this matter is further complicated if the company has an affiliates or agents that live in or have offices in Texas. If they do it could be make the matter murkier. Here is the link to the Texas Nexus questionnaire.

    States have different standards as to when a business is transacting business within that state but every state requires registration for foreign entities doing business in their state.

    So what happens if a foreign entity that was required to register under the Texas Business Organizations Code? There are several consequences that could affect a business’s relationship with both the State and any relationships it has with domestic entities.

    First, the Attorney General is empowered to enjoin the foreign entity from transacting business in the State if the entity is not registrered or the registration was obtained through false or misleading information.

    Second, and perhaps the most important consequence, a foreign entity that fails to register may not maintain an action, suit, or proceeding in a Texas court on a cause of action that arises out of the transaction of business in Texas. While this sounds quite punitive, the failure to register does NOT: affect the validity of any contract; prevent the entity from defending an action, suit , or proceeding; or cause any owner, member, or manager to be come personally liable for the debts, obligations, or liabilities.

    Third, there is a civil penalty for failing to register. The penalty is the amount of all fees and taxes that should have been imposed from the time the entity first should have registered plus penalties and interest imposed by law. – Source

    I recognize the surprise in your comment that certainly a national company would not have to register in all 50 states. Actually, they need to register in those states they do business in. This is why companies use the services of a national registered agent like CSC. They are the ones I used when I was registered in a large number of states. There is also CT Corporation or Unisearch.

    Steve

    Reply
  3. Hi Steve,
    I completely agree with you that this salesrep was awful in explaining the program. But there is just one point in what you said I am wondering about if it was fair. Its the one sentence about that they need to file an application for registration with the Texas Secretary of State. Are you sure about that? For a national company that would be 50 secretary of state registrations. I reviewed the statute at http://www.statutes.legis.stat… “Sec. 9.251. ACTIVITIES NOT CONSTITUTING TRANSACTING BUSINESS IN THIS STATE.”, and it gives a list of exceptions: “(9) transacting business in interstate commerce;”. I think they are engaged in interstate commerce, so was is correct to say that they need to register with the Secretary of State?

    Reply

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