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Debt settlement problem

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Junior Member
What is the name of your state?What is the name of your state? Iowa
My husband and I had a pretty heavy credit card debt which was beginning to effect our credit rating. When we were turned down for a loan because of too much debt we decided we would hire one of the many "debt solution" companies for debt settlement instead of bankruptcy.This was not debt consolidation but a debt settlement where the people we hired would get the cc companies to knock off so much percent of the balance for a one time settlement and we would be done with them. That was the BIGGEST mistake that we have EVER made!! These people made a total mess of our credit and didn't do a thing for us!! We fired them but still had to pay their fees.There were two cc that we owed on. We settled with one of the cards attorneys and got them paid with very little taken off the original debt. The other cc attorneys told us in November that they would settle for a certain amount but right then we didn't have all of the money to settle but would in a couple of months, they knew that. In the mean time we were making $1800.00 a MONTH payments to them to get the balance down and to show them that we were sincere about paying our debt as much as we possibly could. Well, now we have the amount that they told us in November that they would settle for and my husband called them last night to let them know we were ready. NOW they tell us since we were making payments the last few months that they cannot settle and that we would have to pay the full amount,minus less than a thousand dollars maybe, which is almost five thousand dollars more than the original settlement amount.They did not tell us that at the time. We are tapped out financially and cannot come up with anymore and my husband told them that.They said if we don't,the case would go into arbitration next.We are so upset over this. My husband fears that since we can't come up with more that they will garnish his wages or maybe force us to sell our home we just bought and have not even moved into yet. Do we have a leg to stand on in our own defence or are we just up a creek without a paddle? Any advice would be greatly appreciated. Oh, and my advice for anyone is.... don't get involved with these debt settlement companies and if you do, make sure you understand EVERY little detail.
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Arbitration is concentual

You must consent to the arbitration. You may wish to object but if you go in to their forum make sure you understand exactly what is happening. I bet they will withold the evidence you mentioned. Get everything in writing and rebut. Most arbitration clauses(bill stuffers) have been found unenforceable as they rob you of your due process. They won't settle when you make payments. Get behind they want settlement. Are the individual accounts personal and over $25,000?


Junior Member
Thanks Caliber for your advice. The debt on the credit card is approx. $15000.00. We have used it to consolidate some smaller debts and also for personal things needed from time to time. So what happens if we don't agree with the arbitration? Can they force it or take other legal action against us? In this stage of the game what would happen if we stopped sending payments? Thanks again for your help, it is greatly appreciated.

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