In doing research for a client this week, I found something strange is going on.
I called a number of debt settlement companies and found that they’re basically all doing the exact same thing.
I called 5 of the largest companies and asked them all what their fees were and what made them better or different than the other companies in their industry. I selected these 5 because they have the largest numbers of International Association of Professional Debt Arbitrators.
Most of them charge 15% and a couple charge a monthly fee on top of that.
When asked what they do better, they all pointed to their size and how much debt they’d settled recently. One had stats on customer satisfaction and another said they exclusively used attorneys for negotiations. I’m not sure whether credit card companies care that they’re talking to an attorney or not. A settlement is a settlement and my understanding is they look at the past history of the account, the person’s ability to pay and what kinds of quotas they need settled.
Another company bragged that they were the most expensive and the Mercedes of the debt settlement industry. When pressed, they didn’t have a good answer as to why they were charging more though.
One company even told me they settle 80% of all the consumer debts that get settled. I clarified to make sure he wasn’t meaning they settle for 20 cents on the dollar. No, he meant they settle 80% of the debts. He said they settled $30 million last month. I said I’d just spoken to a company that claimed to have settled $27 million and so $30 million couldn’t possibly be 80%. He didn’t have a response for that.
How do you become the top 5 companies in an exploding industry without a clear competitive advantage? I supposed there’s so much business out there right now that they’re getting by just fine without one.
One of these days some company is going to come up with something that’s going to obliterate the competition once consumers start shopping around. It’s not always going to be like shooting fish in a barrel.
For now, being able to document a high customer satisfaction and be friendly on the phone make you the clear winner.
PS. If you’re looking for debt settlement services, the company that had the high customer satisfaction rating was also the only company to not try hard sales tactics on me. If I were in the market for debt settlement, I’d call Marty at Freedom Debt Relief. His direct line is 1-800-544-7211 x16277.