Hi there. I am Michael Bovee with ConsumerRecoveryNetwork.com and I want to
continue on with our debt settlement video series and talk today about some things
that you probably will never hear from a debt settlement company.
Consumer Recovery Network is involved in the debt settlement industry where an
educational service provider and we also provide the professional negotiations
services, but we do it differently, we always have and so because of that I am
free to talk about some of the things at my industry fails at.
One of those is giving you enough information to decide whether settlement
is right or wrong for you. The reason for that is mainly profit.
It is mainly because if you don't engage with their services they are not getting
paid so there is an easier softer less informative approach that is taking to
sell people on the idea that selling is a good idea for them to avoid bankruptcy.
So in this video I want to talk about five things that you will not that we hear
at that settlement company say. Let's start with number one.
"Some of your creditors refuse to work with my company."
The fact is some creditors won't deal directly with a debt settlement firm.
What happens when creditors do this is you are required to let accounts go more
delinquent than might have been necessary.
So when there is something the company is not telling you that some creditors are
not going to work with them, they actually can be impeding your ability to succeed or
save the most with settlement or settle earlier so that there is less of an impact
to your credit report. So I it is a key thing to not share that
information with you. Let's move on to number two.
"The debts of the company will probably not tell you that they have to wait for
some accounts to charge off before trying to settle even though that could cost you more."
What do I mean by that?
Well, if a debt settle in a company tells you that they are going to have to wait
longer than may have been necessary to settle an account, what they are not telling
you is that because of number one where some creditors are not going to work with them.
It forces them to have to deal with the debt collector.
Debt settlement is a very predictable process.
It is why my company exist that is why the entire industry exists and by predictable
when it comes to number two your creditors charge off debts.
They have to it is actually part of the counting principle that they have to abide by.
When they do that they do one or three things.
They send it out to a debt collector just a regular old debt collection agency that gets
paid when they are able to get you to pay them or they will sell that debt to a debt
buyer, an investor, somebody who is risking their money thinking that they are
going to get more back when they collect from you, or they are going to send it to an
attorney and that attorney is gong to collect part of that collection might even
involve suing you to get you to pay.
When a debt settlement company fails to tell you that some of their creditors your
creditors are not going to work with them and they don't have to wait for a debt
collector to get the account before they can actually settle it for you.
They maybe costing you 10, 15% more even higher and the settlement arrangement,
so it will cost you money. For example, one of the major national
credit card issuers currently working with some of the members that we train
and educate on how to settle their own debt are seen 25 and 30 cent on a dollar settlements.
Those same accounts once placed with a debt collection agency or sold off to
a debt buyer or placed with an attorney gets settled by a lot of people in the
companies in my industry at 45%, 50%, wow I mean this could actually mean double the
amount of money that you could haves settled the debt for.
Let's move on to number three.
"You can settle debts on your own and, sometimes, get a better than we can."
Well I just talked about that as part of number two but I want to hit just a little
bit harder so that you actually grasp what I am saying.
When you worked directly with your creditors and they are not working with
another company or maybe they will even work with a debt settlement company.
Oftentimes, my industry gets pigeon hold, why, because the way most of my industry operates.
You pay money into a special purpose account an Escrow fund every month and you
will let that money accumulate over 7 months and in over 7 months you got enough
money now to go settle a debt. However, if you engage with your creditor
before they charge off the account then you are able to settle at that lower
savings often that is available to get settlement companies until it gets out to
collection land and you can get terms so where your saving up for 7 months for the
settlement company that settle it in full you might be able to settle direct with
one of your banks and get 90 day terms.
So you got $10,000 account let's say you settle it for 3,000 and they only need
a thousand in the first month, a thousand in the second month and a thousand in a third month.
So you are able to budget and save and settle that debt and save $7,000 and spend
90 days doing it.
Whereas hiring a debt settlement company you might have missed that opportunity.
Let's move on to number four.
"If we weren't charging you much such high fees, you could actually be out of
debt faster."
Well that is pretty self explanatory because if so many fees are high it
prevents you from settling the second debt, the third debt, the fourth debt
because most of the time debt settlement works like this.
You save up money.
As soon as you have enough to settle one account you settle it.
The company grabs their fees.
You save up money again. Start over another 6 or 7 months adding
money to an account every month and as soon as there is enough settlement debt
companies settles for that and collects their fees.
Those fees actually prolong how long it takes you to finish them so you are not
going to hear them talk about that. You are not going to hear them talk about
how you can do this on your own. You are not going to hear them talk about
some creditors are not even going to work with them forcing accounts out to a third
party to settle for higher rates all because of fees and it is the biggest bone
that I have to pick with my industry since we create a Consumer Recovery Network back
in 2004 our fee has been 15% of savings charged after the fact when we do the settlements.
Most of the settlements get done by our members themselves therefore there is no
15% of savings.
But my industry thrives on that fee structure, they are not telling you that
this can happen so much more faster because and I guess sign up with them.
They are not going to be able to stay in business so fees matter.
Just because CRN's fees are the lowest in the industry historically it doesn't mean
that there aren't good companies out there doing similar things.
There are a couple, unfortunately most companies charge either about 18 to 25% of
your enrolled debt so if you have $50,000 worth of debt their fees 20% of that.
I paid over time.
Obviously that affects your ability to finish them or succeed with them.
Or they charge a percent of savings like CRN does only those fees are 30 to 40
and sometimes even 50% of savings.
Believe me fees matter in debt settlement.
Let's move on to number five.
"You are a good fit for our program, but bankruptcy may still be a better and less
expensive option so go ahead and speak with an attorney before committing to
enrolling in our debt settlement program." Well, that is pretty self explanatory as well.
You're a captive lead that is what the industry refers to you as when you are on
the phone with a debt settlement sales person. So the last thing they want to do
is recommend you connect with anybody else let alone an attorney where you might
learn that bankruptcy is probably an option too because anybody that is looking
at that settlement is looking at it as an alternative to bankruptcy and I get it
bankruptcy want to avoid it.
It is understandable, but might be the right thing to do.
So hearing from somebody that you should go and talk with somebody else about your
situation and there might be a better answer that is consistent with you getting
that debt for the least amount of cost and the quickest way and consistent with your
goals for yourself, fresh start example through chapter 7 bankruptcy, you are very
rarely going to hear that.
You need to research all your options and you are hearing that from me and I am
a debt settlement guy.
So if you are ready to place where you can no longer afford your monthly bills it
is a process of elimination and it involves checking up 3 intervention options.
One is credit counseling; two, debt settlement and you should always
talk with the bankruptcy attorney and find out what your qualifications are for
Chapter 7 and weigh those three things and then make a decision.
Talk wit reputable companies that have built a rapport, that you trust, that are
going share the details beyond these five things, but these five things are very
important for you consider and that is why I am talking about today in our 5 things
that you won't hear from a debt settlement company video.
You could learn more about debt settlement on the consumerrecoverynetwork.com website
Michael Bovee signing off for now.