Hi Guys,

We have been approached by a couple of companies asking us to refer clients for Debt Settlement. The type of settlement they are offering is not in the traditional form, where the client saves a lump sum and the Company negotiates a settlement figure on behalf of the client.

These settlement companies calculate the clients D.I and ask the client to make payments to them as they would in a normal Debt Man Plan. The difference being, the Company is apparently able to negotiate with the lender and arrange a settlement.

The Debt is settled within a few months, but the client will continue to make their monthly payment over a prescribed time period to cover the Settlement Companies fee. The client is a winner as they pay less than half their debt and the settlement company wins, as they receive a higher fee compared to a traditional DM plan.

Can anyone shed any light on this please? Do these companies provide a genuine service, or is it just a sales tactic to get the client hooked in?

Any advice would be useful.

Thanks