ComplaintsforDebt Reduction Services

• Initial Complaint

  10/06/2022

  Complaint Type:

  Order Issues

  Status:

  Answered

  More info

  I begin using Debt Reduction Services for their debt management program. According to their website the debt management plan would not affect my credit score and should cause my credit score to improve. I further confirmed this with the representatives and I have text messages and emails for my proof. I was instructed to stop paying my creditors and to make one monthly payment to Debt Reduction Services and they would handle distributing the payments to the creditors in a timely fashion. Debt reduction services waited over 2 months before contacting one of my creditors to confirm enrollment in the debt management program. Now for the past 3 months my account has been reported as delinquent to the credit bureau's. I contacted Debt Reduction Services directly to address this issue. They stated that because my "account was past due at the beginning it would continue to be reported as past due by that creditor". I have proof that my account was not past due . They failed to do their job and contact the creditor in a sufficient amount of time. Their website and their representative due nothing more than lie to obtain new customers. I have full proof with saved emails and text messages. I have attached the account that shows my payments were paid on time until I was told by DRS to stop payment when I started their debt management program. I have also included a screen shot of their website that shows the false and misleading information.

  

  Business response

  10/13/2022

  Dear ********************,
  
  We are sorry to hear of the frustration our client experienced since joining our program. Its certainly not the norm for our high standards of customer service. We always strive to make our client experience a positive and beneficial one.
  
  When ******************** reached out to us on June 1, as he noted,his account was not past due.  We advised him to stop automatic payments on his accounts to avoid duplicate payments once on our program. Per our participation agreement, item 4, Creditors requiring payments due prior to your first DMP payment should be paid to the creditor to avoid possible late fees.  On July 7, we sent a proposal to the creditor asking them to participate in our repayment program.The client chose to make his first payment to us on July 18, which we forwarded to his creditor in question and which they cashed on August 1. We followed up with the creditor on July 28, August 4, and August 23 asking them to please respond to our request for a payment plan. On August 23, the creditor agreed to our proposal which granted concessions of zero percent interest and a much lower payment than the original amount, saving the client approximately $1,377 combined with his other two accounts.
  
  We understand that protecting your credit score is a concern. FICO states definitively on its site that participation in credit counseling is not a factor in their credit score models (www.myfico.com/credit-education/credit-scores/whats-not-in-your-credit-score).We advise all new clients in writing that they should not open any new credit accounts while on our program. Regardless of participation in credit counseling or not, making late payments and applying for new accounts will negatively affect a consumers credit rating.
  
  We hope the client will allow us to continue saving him money each month on his debt reduction plan. We would love to help him pay off his current and any new accounts he might have. Were confident, given another opportunity,that we can provide him with a satisfying experience to help him achieve a life free from high-interest debts.
  
  Best wishes,
  
  ******************************* and The Client Experience Team

  Customer response

  10/14/2022

   
  Complaint: 18179144
  
  I am rejecting this response because:
  
  Sincerely,
  
  ***************************

  Customer response

  10/24/2022

  This company caused a massive decrease in my credit score due to not properly doing their job. I followed instructions and started paying them as part of the debt management program.  They gladly accepted the full payment and yet did not do their job of securing the creditor in a timely manner. I, personally feel this company should be responsible for the "delinquent payments" that are now showing on my credit report. I have been advised that the account will continue to report as "delinquent" every month until the missed payments are paid.  Those were the payments I was told not to make to the creditor but directly to the debt management program. 

  

  Business response

  11/02/2022

  Dear ********************,
  
  We are sorry to hear that ******************** did not find our early work on his behalf satisfactory. As we do for all our clients, we will continue to strive to make his remaining time on our program as positive and successful an experience as possible.
  
  ******************** paid a minimal one-time administrative fee in June so we could set up his accounts and start working with his creditors and then submitted his first full payment on July 18. Once it cleared on July 22,we disbursed it to his creditors the same day.
  
  We also notified ******************** of the possibility that some creditors might take up to three months to accept our new proposal, which unfortunately turned out to be the case with the creditor in question.
  
  Regarding ******************** credit score, I am happy to provide a free, in-depth review of his credit report to identify the various factors negatively affecting his credit outside of our program, including how paying down his balances will have a favorable effect on his rating. I would also be happy to discuss the many things he might do to improve his credit score. I have offered to speak with him by phone about his situation. This credit analysis could also be done electronically if he prefers.
  
  Additionally, we would like to offer ******************** a gesture of goodwill by waiving the remainder of our program fees while he continues to work toward paying off his accounts at more favorable terms. This way, we will help ******************** accelerate his debt reduction by forwarding his program fee to one of his creditors.

  Best wishes,
  
  ******************************* and the Debt Reduction Services Team

  Customer response

  11/03/2022

   
  Complaint: 18179144
  
  I am rejecting this response because: I do not want this company doing anything with my credit. It's because of their negligence that my score dropped 52 points.  Not 5, not 10, but 52 points. 
  
  Sincerely,
  
  ***************************

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