Business Models Debt Relief Industry

Legal Helpers Debt Resolution Email in Search of Marketers

A tipster (send in your tips here) forwarded me this email, image below, that Legal Helpers Debt Resolution is forwarding in search of companies in the debt relief world that want to “Make Money Next Week.”

It is certainly an interesting approach for a law firm to take and it did strike me that they are pushing the conversion to bankruptcy when this article today says a consumer was turned away from bankruptcy and sold debt settlement after contacting Legal Helpers.


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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.

12 Comments

  • What help is representation in court? The consumer owes the money, are they going to contest the debt? Are they going to try to string it out so the client can save enough funds to likely pay the full amount of the debt plus interest and court and legal fees incurred by the creditor? Do they somehow have better luck negotiating with the creditor in a court room setting in front of a judge?

    I agree with Damon that 100% of the fees should go to BK, and commissions too if the sales person did anything not in the best interest of the client. I am not advocating debt settlement here, but in reality, if you decide not to file BK and try a debt settlement program verses continuing to try to make minimum payments, your probably well ahead in the debt settlement program vs continuing the min or partial payments because you will get back the money in your savings account when dropping settlement and moving to BK. If you had paid the minimum payments, most would of been lost to high interest and even if your balances came down a little, they are going to be discharged in a successful chapter 7 anyway. LH applying some of their fees to the BK is even better.

    In other words, I could see a consumer who cannot afford min payments or credit counseling giving a DS program a try knowing that if they have no other choice but to file BK, at least they are in better shape than giving money creditors that just get’s eaten up in late fees and interest. Also, if the creditors start seeing that when they sue or don’t negotiate and the law firm puts them in BK, they might take negotiations a bit more serious. It’s all in how they screen their clients but if a client qualifies for a chapter 7, but wants to try to avoid it, they were clearly in enough of a hardship to do a debt settlement plan, as long as they can afford the payments.

  • “The Industry Leader in Customer Service and Compliance”….. Interesting

    Legal Helpers really is a substantial size law firm with notable attorneys in the partnership. Why are they risking their livelihoods and practices they have worked so long and hard for if they do not somehow genuinely feel (right or wrong) they are following the law or that they won’t beat regulator action?

    Does anyone have any guesses as to if the FTC and other regulators for that matter, are going to focus on non-compliant business models that charge advance fees, or if the focus will be on marketing compliance which with a model like LH, could take out the front end marketing companies which feed business to LH. It seems like the latter could be an easier route.

    Anyone want to start a list of the front end marketing companies using LH for reference purposes?

    What about past marketing issues, such as un-substantiated claims made prior to October 27th, 2010? My guess is there are companies that have received civil demands for past sins and the investigations will be made public by the FTC in the next couple/few months.

    What about the companies not charging advance fees but still making aggressive claims? Although most have toned down savings claims since Oct 27th, there seems to be plenty of room in the TSR amendment to still go after some of the current marketing messages.

    I used to hear at least 10 debt commercials on my way to work every morning. I don’t remember ever hearing one that said that you can be sued, there a tax implications, it damages your credit, etc. Not even with a fast voice at the end like some other commercials. Heck, I’ve never even at least heard something like “visit abcwebsite.com for important disclosures”

  • “The Industry Leader in Customer Service and Compliance”….. Interesting

    Legal Helpers really is a substantial size law firm with notable attorneys in the partnership. Why are they risking their livelihoods and practices they have worked so long and hard for if they do not somehow genuinely feel (right or wrong) they are following the law or that they won’t beat regulator action?

    Does anyone have any guesses as to if the FTC and other regulators for that matter, are going to focus on non-compliant business models that charge advance fees, or if the focus will be on marketing compliance which with a model like LH, could take out the front end marketing companies which feed business to LH. It seems like the latter could be an easier route.

    Anyone want to start a list of the front end marketing companies using LH for reference purposes?

    What about past marketing issues, such as un-substantiated claims made prior to October 27th, 2010? My guess is there are companies that have received civil demands for past sins and the investigations will be made public by the FTC in the next couple/few months.

    What about the companies not charging advance fees but still making aggressive claims? Although most have toned down savings claims since Oct 27th, there seems to be plenty of room in the TSR amendment to still go after some of the current marketing messages.

    I used to hear at least 10 debt commercials on my way to work every morning. I don’t remember ever hearing one that said that you can be sued, there a tax implications, it damages your credit, etc. Not even with a fast voice at the end like some other commercials. Heck, I’ve never even at least heard something like “visit abcwebsite.com for important disclosures”

  • It is nice to see that they are going to start representing their clients in court. With the drawn out debt settlement plans that their affiliates are selling, their clients are very likely to need quite a bit of court representation. I did notice though it says the clients are responsible for all of the court fees. I wonder how fast that will add up?

    Why not just help your clients in a way that is less likely to have them end up in court????

    I noticed they are now giving partial credit from settlement fees to apply towards a BK. I have spoken to several clients in the past that they refused to do this for, so I am glad they started that, but it should be a full credit and if it happens simply because they were sold the wrong program from the sales affiliate, all of the commissions should go towards paying for the clients BK.

    It is nice to see Legal Helpers making a few good changes, but those sales affiliates are going to be their Achilles heel. They won’t be able to control them.

    https://getoutofdebt.org/Damon-

  • It is nice to see that they are going to start representing their clients in court. With the drawn out debt settlement plans that their affiliates are selling, their clients are very likely to need quite a bit of court representation. I did notice though it says the clients are responsible for all of the court fees. I wonder how fast that will add up?

    Why not just help your clients in a way that is less likely to have them end up in court????

    I noticed they are now giving partial credit from settlement fees to apply towards a BK. I have spoken to several clients in the past that they refused to do this for, so I am glad they started that, but it should be a full credit and if it happens simply because they were sold the wrong program from the sales affiliate, all of the commissions should go towards paying for the clients BK.

    It is nice to see Legal Helpers making a few good changes, but those sales affiliates are going to be their Achilles heel. They won’t be able to control them.

    https://getoutofdebt.org/Damon-Day

    • What help is representation in court? The consumer owes the money, are they going to contest the debt? Are they going to try to string it out so the client can save enough funds to likely pay the full amount of the debt plus interest and court and legal fees incurred by the creditor? Do they somehow have better luck negotiating with the creditor in a court room setting in front of a judge?

      I agree with Damon that 100% of the fees should go to BK, and commissions too if the sales person did anything not in the best interest of the client. I am not advocating debt settlement here, but in reality, if you decide not to file BK and try a debt settlement program verses continuing to try to make minimum payments, your probably well ahead in the debt settlement program vs continuing the min or partial payments because you will get back the money in your savings account when dropping settlement and moving to BK. If you had paid the minimum payments, most would of been lost to high interest and even if your balances came down a little, they are going to be discharged in a successful chapter 7 anyway. LH applying some of their fees to the BK is even better.

      In other words, I could see a consumer who cannot afford min payments or credit counseling giving a DS program a try knowing that if they have no other choice but to file BK, at least they are in better shape than giving money creditors that just get’s eaten up in late fees and interest. Also, if the creditors start seeing that when they sue or don’t negotiate and the law firm puts them in BK, they might take negotiations a bit more serious. It’s all in how they screen their clients but if a client qualifies for a chapter 7, but wants to try to avoid it, they were clearly in enough of a hardship to do a debt settlement plan, as long as they can afford the payments.

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