Superior Debt Relief Services has an article on their site, here, that speaks directly against those pursuing an attorney front debt settlement business model.
Their words are probably strong than mine have been at times so I’ll let the following excerpts and warnings from their site speak for themselves.
Enter- a ‘wolf in sheep’s clothing’ – the attorney-based debt settlement model. In attempts to salvage their businesses, many companies are turning to this model because attorneys may be exempt from the new Rule due to the protection of their state bars and the face-to-face nature of the majority of their consultations. The new rule exempts transactions that include a face-to-face consultation before the delivery of any goods or services, as deceptive trade practices are less likely to occur in such circumstances. Further, consumers buy into the ‘allure’ of using an attorney because of the false security of working with legal representation. – Source
Contrary to the spirit of the new regulation, the attorney model allows debt settlers to continue charging upfront fees, negating the purpose of the FTC ruling. If a consumer doesn’t have a lump sum to offer as settlement to a creditor, the creditor will not honor the settlement, and will continue with collections or even sue the debtor.
Attorney-based debt settlement might as well be dubbed financial self-sabotage. Research conducted by Superior Debt Services on one national attorney-based debt settlement company reveals a harmful fee structure that is exactly what the FTC aims to eradicate with its new ruling. Regardless of whether or not a settlement is actually made, the company takes 15% of the client’s total debt load over the first 18 months of a 36-month long program. – Source
It is refreshing to see a debt settlement company talk so openly and boldly about these issues and these points are some of how I predict other companies will challenge and sell against the advance fee attorney model debt settlement companies.
After October 27, 2010 when the new FTC rules go into effect, prepare to see more debt settlement companies come out on these issues as well.
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