Preferred financial Services - How much can you depend on them?

They really didn't contact me all that much. I told them I couldn't afford to pay. The lady I was on the phone with was really nasty. She was like we won't settle. We will only take what you owe. I got really nervous. But when I got that settlement letter I wanted to call that b**** and tell her off. I originally asked the CC if they would stop all interest and let me pay it off. They laughed at me. They would have got there whole 17K but only get 9. So Im laughing now.

Everything I've read on this page about PFS is scaring the ---- out of me! I've been in a 48-mo. program with them since 1/06 and it doesn't look very optimistic that they can settle the rest of my debts. PFS took my first two monthly deposits ($660) as their upfront fee, plus I pay a $40 service fee every month, and a 25% fee of the settlement amount. To date, of nine creditors in the program, PFS settled only three small debts during my first year, and of the six remaining accounts, four involved summons/judgment or are receiving small payments to buy some time. This doesn't look good at all and I can't afford an attorney to help me get out of this mess. With only 10 months left in the program, I won't have enough time or funds to settle the biggest debt, which has grown from $6800 to nearly $11000 from interest and late fees! Does anybody have any advice, or should I just let the program expire and let the unsettled debts fall back on my lap? I joined the PFS program to avoid exactly what I'm experiencing right now...fear over wage garnishment and stress beyond belief. I wish I hadn't seen this website!!!

mbp,

I have a couple of questions. Are you going through creditors or Collection Agencies? If all else fails what you might want to think of doing and I know this may be hard is filing for bankruptcy.

I appreciate whoever replied to my concerns. I joined the PFS debt reduction program for nine accounts - with one account in default after missing a couple of payments. PFS settled three accounts directly with the creditors within the first months of my program, so it never went to collection. The balances were fairly low, so settlements were easy to pay off. And of course PFS got their 25% settlement fee on each, which I happily paid. I felt very positive that PFS was doing their job for me. Unfortunately, it went downhill after that with my other accounts going first to a collection agency, then to attorneys and finally summons. All of this has me wondering what PFS was doing (or not doing) to allow things to reach this stage one after the other. One debt had to be paid in full ($1800) after a bank levy cleaned out my account! Another debt would not settle, which had to be paid almost in full ($6000) to avoid another legal hassle. It took two years to pay off that one debt using funds I deposited in the program. So between these two debts alone, paying them off without a settlement used up approx. $3500 in projected funds that should have gone to negotiate other settlements! So I haven't been able to build up enough funds in the program to deal with the balance of accounts. I've been dodging one legal bullet after another and don't feel any more secure now than when I got into program. Instead, I feel hopeless about it. As of today, I am making $50 monthly payments to one dept. store account just to defer the judgment while PFS continues to try to settle (?). Another dept. store account is currently in judgment, and PFS is working on a monthly payment arrangement on that as well for $50, but again, no debt reduction and payments could last indefinitely if they can't lower the balance. How will this all end? Add to that the $40 service fees I'm paying PFS each month for 48 months, plus the $660 upfront payment they got at the start, and I could easily end up paying a lot more in this program if it doesn't get under control. Debt free in 48 months? That was the hook. And to top it off, the BIG enchilada awaits me at the end of the line - the $11,000 Visa account that PFS has yet to negotiate. How can they? There won't be a dime in the fund when my term expires. What happens then? Am I in a position to qualify for bankruptcy if I have entered a debt reduction program that failed me at the end? I am a single woman with a very humble income, and I take care of my elderly mother who has no income at all. I am stretched to the limit. Is there an attorney who would even bother to help someone like me? Sorry to go on like this, but I don't know where to turn

Hi mbp1850,

I think you should have filed for bankruptcy to begin with, before your credit got ripped to shreds by debt settlement. According to the National Consumer Law Center's investigation into debt settlement companies [ http ://w ww. consumerlaw.org /initiatives/credit_counseling/content/DebtSettleFINALREPORT.pdf (remove spaces)], it was found that only 1.4% of consumers actually complete the program, and 43% canceled just after paying all the companies fees.

So basically, all they really do is delay the inevitable, for a profit. Debt settlement is only good for those who have a low level of debt, such as payday loans. Using a settlement company for a large amount of debt is like using a hatchet where a chainsaw is required. You can chip-chop away for quite some time, and even still succeed - but most likely the blade will chip, the handle will break, and your hands will become filled with blisters.

Many states are developing laws to restrict and regulate the debt settlement industry, quite a few states already have such laws on their books. And 4 states have already adopted the Uniform Debt-Management Services Act and more are pondering it. I strongly support the UDMSA.

chrys

If you are living paycheck to paycheck then bankruptcy is the best way to get out of debt.

ChrysHenderson , I would have to respectfully have to disagree with you. Many people have benefited from debt settlement who have had a lot of debt. I have settled tons peoples debt who owed over 100k. The problem is that some bad settlement companies like Credit Solutions who will put some one in 4 and 5 year program which is retarded because they know full well the likely hood of them getting sued is super high. If you can't afford at least a 36 month program or shorter than CH7 or 13 is you best option. Plus a lot of bad companies sugar coat the settlement process to get the sale so unfortunately the client doesn't really have a clear understanding of what they are getting into and what to expect. For example , I have secret shopped other companies and heard some say things like " once you get start settlement your credit will be bad but will get better when done" or " you might get some collection calls but tell them you are in a program and the calls will stop." These types of sugar coated lies give the client a false reality of what to expect from settlement and in turn cause the client to want to cancel because they were misinformed. If all settlement companies would have very clear disclosures on their contracts like TASC members these stats would be better regarding debt settlement completion. I guarantee you your debt settlement companies that are TASC members have a MUCH higher % of completion because the pros and cons are laid out quite clearly in the contracts. I do completely agree with you though on some sort of regulation need to be made to better keep settlement companies in check.

It's a good feeling to be able to vent on this forum, and the feedback is helpful. If only I had been better informed in late 2005 about filing for bankruptcy. I was under the impression the laws had changed at that time, and that I could no longer file. That's why I opted for this program, thinking it was the only way out. I admit that I was fearful when I started missing a few credit card payments and panicked big time. Before I knew it, the minimums had tripled with past due amounts and hefty late fees until it was too much to handle. I checked out 5 or 6 debt settlement cos. on the internet and called three of them. The demeanor of the persons who answered the phone were very cold and impersonal, almost crass at times. It turned me off, until I called PFS, who were quite the opposite, offering a friendly voice and reassuring words that everything will work out. When my program was activated, their advice to me was simple: "OK, don't make any more payments to your creditors, and you can relax now." That's all I had to hear! I understand what you mean about a 4-5 year program term encouraging lawsuits, but a 36-month term was impossible on my income, so I had to go with 48 months. But as you now know, PFS failed to achieve some key settlements for me and I paid dearly for it. With the debt I have left and 10 months to go, I don't know if I should withdraw from the program, or let it play out and see what PFS does. I can't settle that huge obligation in such a short time, so does it mean the debt falls back in my lap to handle on my own? The balance has increased almost 40% after not paying for three years! I don't have the skills to fight this alone. Is bankruptcy still viable in my case? What's your take on this also: My agreement with PFS states that I must provide 2 weeks written notice in order to withdraw from the program...AND...that I must pay THEM a 25% settlement fee on any accounts I settle within 12 months of leaving the program! Is this above board? So, if PFS does ZERO negotiations with a particular creditor, and I achieve a settlement on my own after leaving, THEY get a fee? I could kick myself for not paying attention to what was happening, but I've had many personal family distractions, including a brother battling incurable cancer, that I just allowed this to take care of itself. But it's no excuse, so if anyone wants to call me Lady DUFUS...you may!

Yes, there are many debt settlement companies that behave unprofessionally and disrepute the settlement industry. So, before going for a debt settlement company, check the points mentioned here.

I have signed up with them and as of right now I have not had anything settled, it's only been a couple of months but I am getting more and more calls from creditors and I am also getting phone calls from lawyers. When I signed up I was told that they would call for a month or two but I shouldn't worry about that, those calls would stop and they haven't stopped they have been escalated.
Also, what does your credit look like after all is said and done. We were told that our credit would be fine once it was over which I find somewhat suspicious but I am not sure what to make of it. Credit Card companies lie, the Collectors definiately lie. I don't really know what to do at this point. But if I need to pull out of PFS1 I'd like to do it now and cut my losses.

Considering all I've been through these past three years, not feeling like I accomplished much in this program, and with so much debt left unresolved at this late stage, I've decided to make an appointment for a consultation with a bankruptcy attorney to see if I qualify for Chapter 7. It's a late start for me, but I have nothing to lose, and maybe something to gain, like getting my peace of mind back again. Thanks for all the good advice I've read here...wish me luck.

I just signed up and now I'm scared. Not sure if i should cancel

I feel the same way you're feeling now, but at least it's still early in the game for you, whereas I put my trust in pfs1 for three years thinking I had no choice but to honor the terms of the program. You still have time to ask questions, and if you're not getting the answers you want...or not getting a response at all, which has often been the case for me, you need to act on that before you get in too deep. I'm in a position now where I have to seek help from an attorney simply because my remaining debt is too high for pfs1 to settle over the next ten months. I've added up all the money I've put into the program, meaning all of pfs1's fees and the settlements I've paid out, and it totals $13,000 already. I started the program with a $20,000 debt load and pfs1 touted their ability to reduce that by 50% or more. I'm creeping up to my original debt with no end in sight, so I'm desperate for some legal help. Good luck to you, because knowledge is power. Use it to protect yourself!

dont toss settlement under the bus. Frankly it was my life saver there are many companies out there that are scammers giving the settlement industry a very bad rap.

If you are cautious and ask the right questions and do the proper research this is a great tool. I knew what i was getting into before i started and new what to expect. This is why i believe there is a high drop out rate people dont know the facts.

No way would I even consider this company after dealing with Bethany. She hounded me from the begining and after I told her several times I am not interested she so rudely responded as if I was doing myself a dis-service by not giving her my info. I only checked out the website to see what they could do for a family member who is in debt. I, myself, am not in a bad spot right now and she would not take no for an answer. I don't even have any credit cards! She was very unprofessional and I will be contacting a supervisor about her behaviour.

I know 2 other people that are in this program and everyone as pulled out. We have all decided to cut our losses for a couple of reasons. a. the creditor calls never end regardless of what anyone says or what papers are sent or what laws they are supposedly breaking b. your credit is destroyed because they don't pay anything for you and creditors and lawyers just see you as being in deeper and deeper in debt they do not want to work with these people. c. they have no idea what they are doing after 7 months they still don't have my account numbers on file for the cards they are handling saying they only need my social security number? The whole thing is not what I signed up for.
I think that people are correct when they say that debt consolidators misinform people. I was told that calls would stop. I was told that there would be an easy way out of debt so I could get out from under it. I was e mailed and called non stop to sign up saying that they could help me but I had to take the first step. Once I did, suddenly my case was handled by someone else and the quick replys and fast answers were gone.
Use a debt consolidation or counseling company instead of a company that is going to cost you money and run your credit into the ground.
I feel foolish for falling for a line that I could be out of debt in 2 years. It would be nice but it's just not realistic without paying a hefty price. I would rather pay my creditors than to a third party that took advantage of my situation. Credit Couselors help you. You shouldn't join anything that has more than 25 dollars a month of a maitenence fee or service fee. I got NO service from these people.