Report: #160212

Complaint Review: Debt Settlement America

  • Submitted: Mon, October 10, 2005
  • Updated: Thu, January 05, 2012
  • Reported By: dundee Illinois
  • Debt Settlement America
    5080 Spectrum Dr Ste 809w
    Addison, Texas

Show customers why they should trust your business over your competitors...

This debt-settlement companies insist they can suspend this rule of creditors, You pay them upfront fees and then eventually they tell you to save money in your savings account. Which will take almost a year to settle with the creditors for pennies on the dollar.

What they dont tell you is the creditors can garnish your wages and put liens on your home and they cannot protect you in anyway.


Dundee, Illinois
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This report was posted on Ripoff Report on 10/10/2005 02:43 PM and is a permanent record located here: The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year. Ripoff Report has an exclusive license to this report. It may not be copied without the written permission of Ripoff Report. READ: Foreign websites steal our content

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#1 Consumer Comment


AUTHOR: DOUG - (United States of America)

DSA's policy of the customer paying up from come down to this.  My wife and I owed $35,000 in credit cards.  They estyimated how low the total would be cut and then took their $3,500 fee.  Most of my accounts were redeuced by 40-60%. 

For $3500,    I got a deal.  You put money in a savings account--in your bank.  Let's say $100 a week.  That's $400 a month.  They contact a creditor and say my client has $1600 and he ows you $2000 and they settle.  Or if the client can have the amount lowered and make a payment arrangement.  I have 3 or 4 a month getting paid off.  It took a little over 3 years but that was my fault.

In any event, they have no gone out ofr0 business, I found out today.  But from January 2008 until Dec. 2011 they were good to deal with.  In the last year, many of the good ones quit.  I got the feeling something was up.  The new ones they hired were idiots who could care less and knew less about business.
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#2 Consumer Comment

People hear what they want

AUTHOR: Jay - (United States of America)

First I have to ask Attorney Allen something. Do you know what they call the person who passes the bar after his 10th exam? A Lawyer... Which must obviously be you as Ashley has so easily pointed out. If you take 1 min to review the FDCPA it has a section 805 as she listed and copied for you. Oh and an Attorney calling someone a bottom feeder now thats rich.

Right now Settlement companies are currently being demonized as were credit counseling companies approximately 8-10 years ago. Now DMP's are the golden child but if you were in the industry for as long as I have been you remember when the news called them rip offs as well.

With that said there are some good and some shady settlement companies out there. This goes for any business. Some Attorneys truly help people while others defend murders and rapists. Also all contracts are written by Attorneys which is why they have so much legalese in them. Ever read a Card holder agreement from a credit card? Talk about fine print. Also I'm sorry to say but some people are stupid and will hear what they want. Ive worked as a Certified Credit Counselor for over a decade and will still have a rare person think they are getting a loan when signing up while I in no way represented it as such and couldnt be more clear and concise about how a DMP works. But again people can hear what they want to hear.

I do not work for the above mentioned company nor do I know anything about them so I can not speak about their practices. Bottom line though anyone who signs a contract without reading it, well.... what do you expect
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The Truth About Collecting

AUTHOR: Vancouver Collections - (USA)

I am a collector I will leave my company name out of this. I have worked with severley deliquent credit card accounts, I have called many people who are going through this type of program.

I do not understand why people think this is a good idea, because it isn't. Most of the time creditors will work will you I know we can lower interest and stop fees (promptly), and we can also settle accounts directley with the card holder.

There is no need to pay other people to handle your debt you can do it yourself, call your creditors talk to them and tell them what is going on. Most credit card companies will settle lower with card holders than with debt settlement companies. I have seen one such individual where we had offered his debt settlement company 50% but we were able to settle directly with him at 35%, what a savings.

The truth about garnishment, it can and will happen if you constantly refuse to pay your credit card accounts. Credit Card companies are able to verify your employment, file a suit against you, and place a garnishment for up to 25% of your wages. One more thing if credit card companies get the suit in place before you can file bankruptcy there is nothing you can do to make it go away.

People just need to realize that there is hope out there and they can be successful again. They had good credit at one time and in 6-12 months of making payments can have good credit again.

One more thing that debt settlement often fails to mention. The original credit card company can only collect on an account for 7 months, then it sold to a third-party collection agency ( this is considered a charge-off account). For one thing charge-offs on your credit report can look worse than bankruptcy (in some cases). There are certain rules that the orginal lender has to follow but once it charges-off the rules completely change. You may think your original lender has gone to great lengths to reach you and has been threatening, that is only because you haven't dealt with third-party companies. These companies pay a certain percent for your debt and they want to make a profit, which can make them less likely to settle with a debt settlement company especially when they can just file a suit and retrieve the full balance plus some. Oh, did I forget to mention that they add on about 25% for their own fees and can increase the interest rate, so even if you do settle for 50% you are basically paying 75% and have wasted so much of your valuable time and money.

I was not paid to write this, my company probably wouldn't want me to anyway.


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#4 Consumer Comment

You're not a very good lawyer

AUTHOR: Ashley - (U.S.A.)

There is most definitely a section 805, took me about 3 minutes of searching:

Here is the FDCPA, you can read it.

805. Communication in connection with debt collection
Without the prior consent of the consumer given directly to the debt collector or the express permission of a court of competent jurisdiction, a debt collector may not communicate with a consumer in connection with the collection
of any debt
(1) at any unusual time or place or a time or place known or which should be known to be inconvenient to the
15 USC 1692b
15 USC 1692c
805 15 USC 1692c
consumer. In the absence of knowledge of circumstances
to the contrary, a debt collector shall assume that the convenient time for communicating with a consumer is after 8 o'clock antimeridian and before 9 o'clock postmeridian, local time at the consumer's location;
(2) if the debt collector knows the consumer is represented by an attorney with respect to such debt and has knowledge
of, or can readily ascertain, such attorney's name and address, unless the attorney fails to respond within a reasonable period of time to a communication from the debt collector or unless the attorney consents to direct communication with the consumer; or
(3) at the consumer's place of employment if the debt collector
knows or has reason to know that the consumer's employer prohibits the consumer from receiving such communication.
(b) COMMUNICATION WITH THIRD PARTIES. Except as provided in section 804, without the prior consent of the consumer given directly to the debt collector, or the express
permission of a court of competent jurisdiction, or as reasonably necessary to effectuate a postjudgment judicial remedy, a debt collector may not communicate, in connection
with the collection of any debt, with any person other than a consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector.
(c) CEASING COMMUNICATION. If a consumer notifies a debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer, the debt collector
shall not communicate further with the consumer with respect to such debt, except
(1) to advise the consumer that the debt collector's further efforts are being terminated;
(2) to notify the consumer that the debt collector or creditor
may invoke specified remedies which are ordinarily invoked by such debt collector or creditor; or
805 15 USC 1692c
(3) where applicable, to notify the consumer that the debt collector or creditor intends to invoke a specified remedy.
If such notice from the consumer is made by mail, notification
shall be complete upon receipt.
(d) For the purpose of this section, the term consumer includes
the consumer's spouse, parent (if the consumer is a minor), guardian, executor, or administrator
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#5 Consumer Comment

I am an attorney

AUTHOR: Attorney Allen - (U.S.A.)

Robert: I am an attorney. I doubt you are a real person. How much are you paid by debt settlement america to make a fool of yourself like this? Or are you a relative of these bottom feeders who scam anyone they can.

If you had wanted to make a point then you could have posted a link to show the section does exist. You cannot do that. I can.

So to your ignorant comment:
"I doubt you're an attorney. Section 805 of the FDCPA most definitely exists."

Post a link. I am posting a link to the FDCPA that anyone can use to see the act and to see there is no such section.

Anyone who can read will realize that the FDCPA is section 1692.

Robert: You and your company should be tossed into prison for practicing law without a license.
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#6 Consumer Comment

Section 805

AUTHOR: Robert - (U.S.A.)

I doubt you're an attorney. Section 805 of the FDCPA most definitely exists.
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#7 Consumer Comment

Section 805

AUTHOR: Robert - (U.S.A.)

I doubt you're an attorney. Section 805 of the FDCPA most definitely exists.
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#8 Consumer Comment

Section 805

AUTHOR: Robert - (U.S.A.)

I doubt you're an attorney. Section 805 of the FDCPA most definitely exists.
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#9 Consumer Comment

Section 805

AUTHOR: Robert - (U.S.A.)

I doubt you're an attorney. Section 805 of the FDCPA most definitely exists.
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#10 Consumer Comment

They REALLY helped me

AUTHOR: Robert - (U.S.A.)

When I saw the train wreck coming last year due to health and employment issues, I contacted DSA and another company. I've been in the program since October, 2008. Four of my credit cards have been settled for 20%, and it was tough coming up with that, but it was in my savings account. I finally got a job, but I'm so far behind on my bills.

Even if I cannot settle with the remaining 6 cards, I am better off than I would have been had I not contacted DSA. I will admit that now that 4 of the card accounts are at Mann Bracken, and Frederick Hanna, I am very nervous.

Everything, and I mean everything was fully disclosed up front. There was no fine print; there was no sugar coating. I did what I had to do to avoid a bankruptcy. Chase may force me into it, but for now, I've gotten good advice from DSA.

I think the state and county in which you live has something to do with your success. Also, your level of communication with your representative is key.

Robert W., Fort Worth, TX
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#11 Consumer Comment

Debt Settlement America is a scam

AUTHOR: Attorney Allen - (U.S.A.)

I do not blame this Elizabeth for not using her real name. I doubt she would go out of her way to make this stuff up. I am looking at a similar contract from DSA.

As an Attorney, I am reviewing a contract signed by a client with DSA (Debt Settlement America). They have the client pay an up front fee of over $2000 to try to settle $33,000 worth of debts. By the time the client is completed with the contract, the DSA fee will be over $5000.00 They place in the fine print of the contract there is no agreement with the creditor to accept their projected estimation of the payoff. The DSA contract also relies on a non-existent section of Federal Law, Section 805 of the Fair Debt Collection Act. There is no such section. DSA is, in my opinion, a bottom feeder.

I would urge anyone thinking of using this company to read the contract first. Any company that needs this much fine print and legalese to do business should be suspect just on that alone. Further, in my experienced opinion, the business charges an oppressive and large fee for a "debt the reduction settlement" the creditors may or may not accept.

This is a for profit company that in my opinion is scamming people. I believe that anyone who would like to pay off creditors without filing bankruptcy would be better off going to a legitimate non-profit organization like Credit Counselors of America. I think this company is also trying to get play off the good name and reasonable fees charged by Credit Counselors of America. I do not represent Credit Counselors of America or have any reason to be lauding their work other than to steer people away from this DSA company that looks to me like a scam.

Further DSA, while claiming not to provide legal services in thier contract is borderline practicing law without a license. You would think they could learn to spell in their contract where they mention creditors can still "cease" secured property (the proper word is sieze).
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#12 UPDATE Employee

Mischaracterization likely by competion or collector

AUTHOR: Chris - (U.S.A.)

The characterization by Elizabeth is false and defamatory. After researching prospects and client information over the last year, Debt Settlement America has never spoken with an Elizabeth from Dundee, IL or for that matter anyone from Dundee, IL that could be found in our records. I will assume the individual that made the complaint likely represents a creditor, collection agency, or competition that wishes to bad mouth Debt Settlement America with defamatory comments.

Debt Settlement America is probably one the most open, straight shooting companies in the business. We always disclose the pros and cons of debt settlement. This is done on the website, when speaking with a debt specialist, in our contract, and it is reviewed one last time when a client starts the program. Most clients that enroll in debt settlement are experiencing a financial hardship due to reduced income, loss of job, or disability.

In response to ruining ones credit, most of our clients' credit is already bad or is about to become bad due to a financial hardship when they enter the program. Yes, debt settlement affects ones credit negatively while they are enrolled in this program, but it will affect them a lot less than filing bankruptcy or not ever resolving their debt. This program is not for someone trying to avoid paying their debt; it is for people with a financial hardship and that have few alternatives. Ones credit will typically recover after a client completes the program which is typically 3 years.

In response to the statement that creditors have the right to sue and in most states and the right to attempt wage garnishment or attempt to get a lien on a house, that is statement is true but is incomplete. Does this happen very often? The answer is no. It depends on the creditor. There are only a handful of creditors that are suit happy and that would spend $2000 on a suit for a $500 debt, if a potential client has one of those creditors this is disclosed. On the bright side most creditors want to resolve this and offer settlements of 40 - 60% on average.

This is an aggressive program that typically takes 24 - 36 months to become debt free. The pros in most individuals with a financial hardship outweigh the cons.
All of this is fully disclosed on the website
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