2/11/2010 1:18 PM (PST)

Joanne,

We don't have a report on Legacy Debt Solutions - maybe they are a brand new business, which in and of itself should create caution in your mind. In general, the BBB's history overall with debt settlement companies has not been good. Most people who complain about these companies state that their debts weren't negotiated, they were told to stop making payments, and the result is that they're in worse shape than when they started. Many are sued and are forced to file bankruptcy to rid themselves of the lawsuits. Debt settlement companies have a good sales pitch that makes the program seem like a no brainer but unfortunately it's a mirage. This industry is rife with companies using predatory fee models.

The Federal Trade Commission does not look favorably debt settlement operators. The FTC has scrutinized the fee schedules commonly used by these settlement companies, in particular the timing of fees (usually front end loaded) and the high level of these fees. A good roundup of the recent FTC public forums, investigations, and Notice of Proposed Rulemaking on debt settlement/negotiation can be found at:

http://www.venable.com/ftc-hosts-public-forum-on-proposed-debt-relief-amendments-to-the-telemarketing-sales-rule/

Debt settlement is a topic the BBB of the Southland has posted about on our Facebook page:
http://www.facebook.com/pages/BBB-of-the-Southland/117568537756

Specifically, check out the "BBB Criteria for Evaluating Debt Settlement Companies" posted on our Facebook page on October 28, 2009 (click on the Notes tab and then scroll down to October 2009). These criteria for evaluating debt settlement companies are very stringent because of the rampant abuse and predatory fee models that are so widely used in this industry. That being said, we know there are some debt settlement companies out there who are reputable and who deal fairly with their customers.

Use the Google box that is on the main Ask The Community page and search for "debt settlement". You'll get lots of previous responses about this topic.

If you haven't done so already I would start your journey with a call to a reputable nonprofit credit counseling agency that will identify and explain your options. The counseling session will be FREE. The National Foundation for Credit Counseling's direct agency referral number is 800-388-2227. This will connect you to a reputable, accredited agency in your area.

Lastly, make sure you review your credit report and make any corrections to incorrect or stale derogatory information in it. Take a minute to read this report from the LABBB on what you should know about your credit report (by the way, just cut and paste all of the links mentioned in this response into your browser):

http://www.la.bbb.org/GIReport.aspx?DocumentID=165

Good luck.

2/22/2010 9:02 PM (PST)

A friend of mine works for Legacy. Judging by the conversations I've had with the friend about Legacy, I would say it is a legitimate business. As with any other business they are out to make a profit, but their practices and charges seem fair. I'm in debt myself, not so much as to warrant debt settlement, but enough to know the fears & worries of those that are in that much debt. If you commit to the programs they offer, you could potentially save a lot of money over paying the debt off traditionally. Check out their website www.legacydebtsolutions.com and look for yourself. The website is simple and straight-forward. I would not rule out debt settlement. There are viable and progressive debt settlement companies out there, but I would strongly advise you research all options before making a choice, regardless of what choice you make.

3/1/2010 4:13 AM (PST)

I have search the world, and there is only ONE reputable company I have found (www.deptsolutionsusa.com). They have an "A+" rating with the BBB, which is undoubtedly hard to find. EVERY, I MEAN E V E R Y other company I checked has a "F" rating with the BBB. This company has only had 6 complaints in 3 years, and all have been resolved. This is your best option, trust me, and I'm not a salesman for the company. Good luck!!!

3/11/2010 7:48 PM (PST)

Troy M.
Are you sure your not a salesperson for that company? I researched your company "Debt Solutions USA", and clicked on their boasted "A+ BBB rating", and found out that their rating was stripped due to 1 of 2 reasons:

1) Non Payment- which for the BBB you can be listed by either paying a fee or having complaints. Any company in the debt settlement industry will be listed with an F rating. Being that it is a new industry the BBB does not know how to rate debt settlement companies so they blanketed the industry with a F-Rating. The only way to attain a A+ rating is if you have been grandfathered in by doing Credit counseling or some other type of financing and took on debt settlement to your company.

2) •Failure by the business to maintain its BBB Accreditation, or abide by the program standards or dispute resolution requirements of the BBBOnLine program. Meaning you had a complaint or you did not follow good business practices and you were stripped of your "A+ BBB rating"

Although the BBB stands for a great idea to give new consumers idea's on whether they should do business with a credible company by user's feedback. They're rating system may not hold true to its original motion seeing how the major credit card companies hold A+ ratings but have been raising interest rates on their loyal clients who have never missed a payment. Out of the millions of people using their product ask yourself "would one of those people file a complaint?"

TASC and USOBA are the governing bodies that regulate, lobby, and audit all their members to make sure they are practicing honest business practices in the settlement industry.

3/4/2011 10:22 AM (PST)

Prada, what is their pitch and what are the fees they are charging? Because of the abuse that the debt settlement industry has perpetrated on the public, the FTC rules enacted strict rules in October of 2010 to better protect consumers from debt settlement scammers and operators. There are hundreds of these companies still operating in spite of the new FTC rules, and before you buy into any sales pitches we would encourage you to read some articles about debt settlement that we have posted on our Facebook page, at www.la.bbb.org, and on the FTC website. Here are some for starters:

NEW LAWS GO INTO EFFECT TO FIGHT DECEPTIVE DEBT RELIEF:
http://www.la.bbb.org/GIReport.aspx?NewsID=295

DEBT SETTLEMENT INDUSTRY GETS ITS COMEUPPANCE FROM THE FTC
http://www.facebook.com/note.php?note_id=455365482194

WHAT THE FTC RECOMMENDS FOR SETTLING YOUR CREDIT CARD DEBTS:
http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre02.shtm

There are two BBB reports on the business:
http://www.bbb.org/charlotte/business-reviews/debt-negotiation-companies/legacy-debt-solutions-in-charlotte-nc-237322

http://www.bbb.org/tulsa/business-reviews/credit-and-debt-counseling/legacy-debt-solutions-in-tulsa-ok-38015387

Unfortunately, getting out of debt is no picnic and it's a shame that so many "cures" become worse than the disease.

3/15/2011 2:11 AM (PST)

I would not use them based solely on their sales tactics. I don't know if they are even still in business or if the new FTC law drove them out, but they really tried to work over a client of mine last year until I found out about it and got her out of the program. You can read about her experience here http://damonday.com/1017/legacy-debt-solutions-vs-credit-solutions/