I am curious of your experience with Debt rx Usa. I have had an absolutely miserable time with them. In fact I don’t get the Jerry MaGuire approach at all, it’s more like a cork in the ocean feeling. I question the legitimacy of this group.
In a nutshell, Since I have joined up with this “Company”, there have been overcharges in my fees, lost faxes, unreturned phone calls, mis-information, and a generally lack of attention to my account. My situation has worsened since I intially called these people for help. Now all I get from them is an answering machine.
First, let me preface my answer by saying that I have no personal knowledge about Debt Rx USA except for what I read on their website or in their public press release. But I would like to give you some general observations about the monthly payment debt settlement process and my thoughts on their public information.
You made mention of the Debt Rx USA Jerry Maguire approach which puzzled me at first until I read their October 22, 2008 press release in which they said “The difference between DEBT RX USA and other settlement companies is quite simple: They want to bring the “Jerry Maguire” approach to the debt settlement industry. For those of you that have not seen the movie; simply put: fewer clients, more personal attention.” So I assume that is what you are referring to, but that sure doesn’t sound like the experience you’ve had.
Disclaimer: In the past, I have used lump-sum debt settlements when clients had the cash on hand to settle right then. We were able to achieve some good outcomes from those settlements and when used surgically and appropriately for a select client, it can be a good solution. I have never engaged in monthly payment debt settlements because the downside and risk are far too great, in my opinion.
Monthly payment debt settlements work like this:
- The client pays the debt settlement company a deposit and service fee each month. The amount of money not used to pay the service fee is credited to the clients deposit account with the debt settlement company.
- When sufficient funds have been accrued in the deposit account, they are then used as a lump-sum payment with a creditor to settle a debt.
- During the time that the client is generally not paying the debt settlement company, they wind up not paying the creditor. The debt settlement company has either told them to do this or they can’t afford to do both.
- When creditors are not getting the minimum monthly payment the creditor expects, your account will go past due, will be negatively reported on your credit report, and will proceed through collections and/or legal action.
- Creditors have been known to sue consumers in monthly payment debt settlement programs and go for a judgment or wage garnishment to recover the money due them.
- A debt settlement program will not stop collection calls.
Continuing to pay your monthly payments to your creditors does present an interesting conundrum. If you remain current with your debts, then there is no incentive for a creditor to settle. The best settlement offers occur once you are typically 90 days past due but if you have a good credit report and a good credit score, you will have to trash it to get a good settlement.
On top of all of those issues Ralph it seems like you feel that Debt Rx USA has just simply delivered poor customer service to you through a lack of communication or response to your account and inquiries. When you are sending an organization money and they won’t return your phone calls, it is only natural to grow worried and concerned.
I did call Debt Rx on their advertised toll-free number, 877-661-3834, and a human did answer and said that it was the customer service number that any client should call that number to speak to a human. If they gave you a different telephone number, call the toll-free one and see if you can speak with a human, as I did.
I then took a look at their website and found some of the information to be incomplete in my opinion. At least I felt there is some room for improvement.
Let’s look at the following statement from their Frequently Asked Questions page where they say “How does this affect my credit score? Unlike other alternatives like bankruptcy and consumer credit counseling (CCC), entering our program is NOT reported on your credit report. Your employer, landlord or any other company or organization who may view your credit report will NOT see that you are in our debt settlement program. However, like all debt relief programs your credit rating will be affected. How much your credit is affected depends upon your current credit score.”
What concerns me here is that it is not clearly spelled out that a debt settlement approach can absolutely negatively impact your credit score. While they don’t report the fact that you are a client of theirs, if you are not paying your creditors, but instead, sending monthly payment to the debt settlement company those payments are not sent to the creditors. The creditors will then report them on your credit report as missed payments and that will be reported on your credit report for the next seven years.
This section also does not make clear that the amount of debt forgiven can also be reported as written off, charged off, charged off to profit and loss, or uncollectible and that can be viewed negatively as well.
Under the Debt Rx USA Company Highlights they say “Pledge to Arbitrate: DEBT RX USA has signed a pledge to arbitrate and all contracts contain an arbitration clause.” I’m not sure how that is a highlight for you if the arbitration clause prevents you for taking legal action against them if you are harmed in any way. Arbitration clauses generally protect the company more than the client.
One huge piece of information that I could not locate on the site was about the potential tax implications of settling a debt. The amount of debt forgiven by the creditor will be reported to the IRS and you will have to pay income tax on that amount.
Here is what I suggest that you do.
- Let’s be fair and start out with a clean slate and assume that all of your customer experiences to date are behind you and give them one more chance.
- Write Debt Rx USA a letter outlining your concerns and issues and fax it to them at 469-519-4272, mail them a copy by some sort of traceable means to them at Debt Rx USA, 3102 Maple Ave, Suite 450, Dallas, TX 75201, and upload a copy of that letter to me. In fact, I would love to take a look at the client contract they asked you to sign. Scan that and upload it for me to see as well.
- Give them an opportunity to respond to your issues and address them. Ask for the response to your letter to to be in writing.
- If you are unhappy with their response to you then you could elect to discontinue your service with them.
What I would like to do is post a copy of the letter you send to them, eliminating your personal information of course, and then for you to upload to me a copy of their written response to your letter and I will post that here on the site as well.
What I am hoping is that Debt Rx USA will address each of your issues professionally, provide you with a satisfactory response to your concerns and hopefully provide a response that gives you and others, confidence and clarity.
By posting their response on the site it will allow their response to your issues to speak for itself and others can then make up their own mind about the level of customer service, responsiveness, and satisfaction with the answers to your questions that Debt Rx USA delivers.