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 Posted: Wed Apr 16, 2008 3:11 pm Subject: Debt Settlement Fees |
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Does anyone know what the average fee is for using a debt settlement service? So far I have 15 & 16% of my total debt. A couple of companies want their money upfront and the other two I talked with will spread the payments out over several months. I have no way of knowing if they are honest, do what they say or are scamming me. Any tips would be appreciated.
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maryd
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| Posted: Wed Apr 16, 2008 3:23 pm Subject: |
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Get it in writing, if they are offering you a payment arrangement over a period of time, they should have no problem putting it in writing.
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erb1953
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| Posted: Thu Apr 17, 2008 4:30 am Subject: |
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The two most prominent structure of payment used in the debt settlement industry are:
The contingency fee structure and the front-loaded fee structure.
Under contingency fee structure, the following fees are normally charged form the client.
Administrative charges
Negotiation fee( a percentage of the amount saved in the negotiation, normally 25% of the accounts settled)
Monthly service charges ( the amount charged by the firm to manage your account, it can be anything between $30 to $80 per month)
However, it seems that you are under the front-loaded fee structure, which has the following break-up of the fees.
A flat percentage of the debt (normally it ranges between 12% to 16% of the debt)
Monthly maintenance fee
And, miscellaneously charges.
Hope the inputs help.
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Garcia Remonds
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| Posted: Thu Apr 17, 2008 4:43 am Subject: |
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Hi mary, I too am struggling through the same problem. I have enrolled myself with a settlement firm and is paying the following charges.
Monthly service charges=$50
One time creditors enrollment fee=$100 each creditor upto the first five creditors and $50 for each creditor more than five.
Miscellaneous and/or NSF fees=$30
They also charge 20% of the money saved during the negotiation with the lenders.
*company name deleted as per the forums rules-Jason
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JenifferW
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| Posted: Thu Apr 17, 2008 8:49 am Subject: |
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I had same struggle 2 months ago. I did not have enough money to pay monthly minimums on CC's so I was behind payments. Phones were already ringing off the hook and settlement companies I talked asked 15% to 11% up front before settling any account. I am sure they want their money first because my credit is in the tank. I have & had high balance on 11 acounts-25K to 7k. I think high balance accounts will be likely lawsuit candidates.
I had my 3 big account settled pre-charge-off (before 180 day past due) in last March (67K total)-Chase acount was on the way to litigation on only 4 month past due!! I am using James Lombardo. He charged me $500 retaing fee 2month ago then I pay him 20% of savings as he settles accounts. No monthly fees nor enrollment fees of any kind I paid him so far. He can be great help if you are looking for quick settlement before charge off( 6month past due).
*company name and link deleted as per the forum rules-Jason
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scottinred
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