Understanding Consumer Debt Mediation (Debt Settlement)

Consumer Debt Mediation—also widely known as debt settlement or debt negotiation—is a debt reduction strategy where a consumer and a creditor agree upon a reduced balance that both parties accept as payment in full. This process often serves as an alternative solution to facing a legal judgment.

A Crucial Warning About Stopping Payments

  While debt settlement is a viable option for some, it is vital to approach the process responsibly. Our firm strongly advises clients against intentionally stopping payments to their current creditors simply to force a settlement.

This tactic is damaging to consumers in every respect.

When you cease making agreed-upon payments, your balances do not remain static; they continue to grow rapidly due to:

• Accumulating late fees

• Ongoing interest charges (including potential default interest rates)

• Additional contractual costs

Ceasing payments without a formal agreement can severely harm your credit score and financial stability long-term.   

How long will negotiations take?

The time to settle accounts varies based on each person's situation and creditor rules. Usually, it takes three to six months. Some cases may take up to a year, depending on individual goals and financial ability. Clients with lump sum payments often settle faster, while those needing payment plans may take longer. Some creditors respond quickly, while others have policies that slow the process.   

No escrow accounts-You control your money

WCM does not hold funds in an escrow account nor does it disperse any payments to the creditors. Once a settlement agreement has been reached our clients are instructed to make either a lump sum settlement payment or arranged payments directly to the primary creditor or attorney/collection firm. Once the first payment has been established WCM will close the file and submit a release of the POA.   

FTC Rule - No front-loading fees

WCM Does Not front-load fees or charge a fee based on the total amount of debt you owe. Many, so-called, debt settlement companies charge anywhere from 18%-26% on top of the total debt that is owed. This can amount to thousands of dollars added to your debt load and only serve to drive you further into debt - and it is illegal!  

Performance Fee

A performance fee will be assessed on the amount that WCM actually saves you not the total amount of the debt you owe. The performance fee is a percentage based on the reduced amount and is fully disclosed to you upon your free analysis. This fee is not assessed until a settlement has been reached and accepted by our client with the initial payment completed. Our fee is performance based - as it is the only measure that matters to our clients.

Cost on work performed

Some cases may require actual work to be performed prior to negotiations. For example a consumer may be facing a lawsuit or may have a judgment wrongly entered against them and require the assistance of outside counsel or legal document assistant (LDA); as defined under The Business and Professions Code Section 6450. Cost varies from case-to-case and is considered actual work performed and not associated with the process of negotiating the associated debt.

Debt negotiations isn't for everyone

Truth is, debt negotiation isn't right for everyone. Some consumers have so much debt and so few assets, that settling one or two accounts wouldn't be a reasonable approach to debt relief. Our team will be honest with you and if this seems to be the case we will decline or services and suggest an alternative.

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 We have successfully settled debts with: CACH, LLC, Portfolio Recovery, Patenaude & Felix, APC, Midland Funding, Mandarich Law Group, LLP, Reese Law Group, FarMar Law Group, PC, Velocity Investments LLC, Hunt & Henriques, LLP, Gimbal Capital Inc, LVNV Funding LLC, PMGI Financial LLC, Calvary, Zwicker & Associates, P.C., Wells Fargo Bank, SFM-6 LLC, Bank of America, Quall Cardot LLP, The Moore Law Group, American Express, Persolve, Law Offices of Kenosian & Miele, LLP, Capital One, Citibank, Springleaf Financial, Atlantic Credit and Finance Inc, US Bank, HSBC, Discover Card, - to name a few. WCM is dedicated to negotiating settlements with meaningful reductions; avoidance of attorney fees and cost; without entry of judgment. Individual results may vary.

Disclosure:

Estimates are based on historical results and individual results may vary. Not all clients are able to complete our program for various reasons, including their ability to save sufficient funds. Our clients experience greater satisfaction and reduced stress by having a knowledgeable negotiator fighting for them and avoiding the pitfalls of going in alone. Statements made are examples of past performance, which are not intended to be a guarantee of any future settlement results. West Consumer Mediation (WCM) assists with unsecured debt and any use of "debt free" or "debt relief" are forward looking statements ACCOUNTS, authorized by our client and successfully settled and accepted by our clients. While our negotiators work aggressively to reduce your debt balances, creditors are under no contractual obligation to negotiate or accept settlement offers. Debt reduction percentages do not guarantee that your debt balances will be lowered by a specific amount or percentage, or that you will be debt free within a specific time period. WCM, has not been endorsed  by any government agency and WCM is not an agenT of any government. We do not assume consumer debt, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice. Actual testimonials may be presented but the names have been edited or redacted to protect our clients under our privacy policy (see privacy notice). Services may not be available in all states.