Tampa Debt Settlement Attorney

How Do Debt Settlement Companies Typically Work?

Typically, when a debtor contracts with a debt settlement company, the company will negotiate a lower amount for the debtor to pay on his credit cards, loans or other unsecured debts. Most debt settlement companies will ask the debtor to pay to the company, a monthly payment. The debt settlement company will take monies from this monthly payment to satisfy its fees, with the remainder available for payments to creditors. Once sufficient funds are acquired by the debt settlement company, the company theoretically will then pay the creditor in a lump sum settlement.
The problem with this methodology is that the monthly payment is usually not significant enough to acquire sufficient funds to settle the debt within the time generally needed to obtain a settlement.

Jay Weller and Weller Legal Group has been settling debts on behalf of its clients since 1993, over two decades. The optimum time to settle a debt is when the debtor is approximately eight months behind on his unsecured debts. The time period can change depending on the creditor, but eight months is a good basic period for successful settlements. Many debt settlement companies will require payments over much longer periods than eight months. Usually, by the time the debt settlement company obtains sufficient funds to settle the debt, the debt is so seriously delinquent that the account has been referred to an attorney for litigation. A litigating attorney is usually not amenable to a settlement, as his function is to consummate the lawsuit, and not to negotiate with a debtor.

The other problem with many debt settlement companies is that not only is their methodology flawed, but many of these companies are fraudulent. There have been many instances of debt settlement companies that do not deliver what they promise, and further refuse to return any funds that are paid by the debtors. Many of these companies originate from California.

A proper debt settlement is through a one –time, lump-sum payment. If the debtor does not have the funds to make such a payment, Mr. Weller will usually counsel against attempting a debt settlement. If the debtor is not able to settle his debts through such a payment, our office has many other programs that might benefit, such as Credit Counseling, Credit Repair, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, and other programs.

Weller Legal Group represents many Clients in Settlements of Debt. Our Tampa Settlement Attorney can Settle almost any type of Debt, including Credit Cards, Medical Bills, Taxes owed to the Internal Revenue Service, and other varieties of Debt. The Settlement usually involves a one-time payment to the Creditor, along with a concession from the Creditor that such Debt is fully satisfied, and reflected accordingly on his or her Credit Report.

A Loan Modification may be beneficial . Lowering the homeowner’s monthly mortgage payment may liberate funds to pay credit cards or other loans. There are many ways to deal with the sometime overwhelming crush of debt. Please contact Mr. Weller today for a free and friendly consultation.

What Is A Debt Settlement?

A Debt Settlement is wherein our office can pay off a creditors account balance with a one-time lump sum payment to that creditor. For example, if a debtor owes $10,000.00 on a Bank of America credit card, he can pay that credit card in “full satisfaction of the debt” by making a one time payment to Bank of America in the amount of $4,000.00 or $5,000.00. The creditor must agree to this Settlement in writing. What I refer her to as a Debt Settlement is very different from the debt settlement companies that have been featured in many of the advertisements appearing on television. In these situations, the debtor will be instructed to pay a monthly amount to the debt settlement company. The debt settlement company promises to hold these amounts in an account, and pay the creditor in settlement once the account has aggregated sufficient funds. The problem is that by the time the debt settlement company can pay the creditors, the debtor is so far delinquent on his Debts that they are past the time for Settlement. Once a creditor sends the debt owed to an attorney for collection, it is too late. The attorney is not interested in a Settlement. The attorney’s interest is in suing the debtor and getting a Judgment. The method used by these debt settlement companies is faulty, leading to more problems for the debtor. The only good way to settle a debt is through a one time payment to that creditor, which is accepted by the creditor, in writing, in full satisfaction of the debt. The other problem with many of the debt settlement companies is that their conduct is fraudulent. Many of my clients have come to my office after having begun affairs with a debt settlement company. After about four (4) to six (6) months, the client usually realizes the debt settlement company will not deliver on its promises. The client will then contact the debt settlement company to terminate the services, and be informed that the debt settlement company will retain for payment of its fees, all or the majority of the monies paid into the program. A number of these debt settlement companies, especially those stationed in California, have been the subject of investigation and prosecution, by the State Attorney of their respective States. After we have settled the debt, we request the client return to our office in order that we may pull his credit report. The credit report must designate that the debt has been “settled or paid in full satisfaction of the debt”. If the debt is not properly reflected on the credit report, our office will take measures to mandate that the creditor accurately report the debt.