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Power of Attorney for Debt Settlement

On May 12, 2011, in Debt settlement, by John A. Weber IV, ESQ.

We have recently encountered some issues during debt settlement negotiations with creditors.  It now seems to be  an increasing trend that creditors are requiring a power of attorney form, even from your attorney, to discuss the creditors accounts.  Generally, a letter of representation or an authorization form is sufficient.  Don’t be shocked however when they refuse to speak with  any person who has not been given an effective power of attorney.  Although it seems to be a little redundant to have an attorney given such powers (which the retainer has seemingly already given him), the hurdle is minor and is generally easier to comply with than to challenge.  If there are any questions or concerns regarding whether or not granting your attorney the power of attorney is a wise decision, then feel free to call us at (516) 858-2620!

We proudly assist residents of Long Island: Nassau county, Suffolk county, New York City: Queens, Brooklyn, Bronx, Staten Island, and Manhattan with their debt issues.

Call (516) 858-2620 to arrange a FREE  consultation with a Debt Settlement attorney!

News: No Upfront Fees For Debt Relief Companies

On August 6, 2010, in Message/News Board, by Robbie L. Vaughn, Esq.

Federal Trade Commission (FTC)  issues rule prohibiting debt relief companies from collecting advance fees.

“Starting on October 27, 2010, for-profit companies that sell debt relief services over the telephone may no longer charge a fee before they settle or reduce a customer’s credit card or other unsecured debt.

Advance Fee Ban

The Final Rule contains specific requirements for debt relief providers related to charging an advance fee before providing any services. It specifies that fees for debt relief services may not be collected until:

  • the debt relief service successfully renegotiates, settles, reduces, or otherwise changes the terms of at least one of the consumer’s debts;
  • there is a written settlement agreement, debt management plan, or other agreement between the consumer and the creditor, and the consumer has agreed to it; and
  • the consumer has made at least one payment to the creditor as a result of the agreement negotiated by the debt relief provider.

To ensure that debt relief providers do not front-load their fees if a consumer has enrolled multiple debts in one debt relief program, the Final Rule specifies how debt relief providers can collect their fee for each settled debt. First, the provider’s fee for a single debt must be in proportion to the total fee that would be charged if all of the debts had been settled. Alternatively, if the provider bases its fee on the percentage of what the consumer saves as result of using its services, the percentage charged must be the same for each of the consumer’s debts.”

Click this link to read the entire FTC press release

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. This website is Attorney Advertising. It does not form an attorney-client relationship. We are a debt relief agency and a law firm that helps people file for bankruptcy relief under the U.S. Bankruptcy Code – Title 11. Prior results do not guarantee a similar outcome. Proudly assisting residents of Long Island, Nassau county, Suffolk county, New York City, Queens, Brooklyn, Bronx, Staten Island, Manhattan