Freedom Debt Relief Credit Counseling Customer Stuck with Big Judgment in Alabama Credit Card Lawsuit
Freedom Debt Relief advertises itself as a way to avoid Chapter 7 or Chapter 13 Bankruptcy by negotiating discounted debt settlements for people with lots of credit cards, medical bills, personal loans, or other unsecured debt. Like all debt settlement companies, they aren’t attorneys, and they cannot do anything you can’t do for yourself. Here’s a very typical, but unfortunately real example of what happens when you trust your finances to a debt settlement outfit like Freedom Debt Relief.
In the District Court of Mobile County, Thomas B— was sued for $3,873.38 by Capital One. Case No. 02-DV-2014-902455. After he was served with the summons and complaint, he sent a response to the credit card lawyer. He said:
“In order to avoid bankruptcy, I turned to Freedom Debt Relief for credit counseling and debt payment direction. We have given them our power of attorney to deal with all of our creditors…please have all documents and correspondence going forward passed through them.”
The poor guy. He had apparently signed up with Freedom Debt Relief, who promises that
“Once you enroll in the Freedom’s Program, we become your credit advocate, working solely on your behalf.”
So Thomas naturally assumed that when one of his creditors decided NOT to work with Freedom Debt Relief, but instead to sue him, he simply trusted that his “credit advocate” would step in and help him.
Unfortunately, that is not what happened. Since Freedom Debt Relief is not a law firm, they couldn’t step in and help. So a few weeks after being served with the lawsuit, the Court entered a judgment against Thomas B— – for $3,873.38 plus court costs! This is all a matter of public record, and the truth is there for all to see.
So not only did Freedom Debt Relief fail to help this man, he ended up with a judgment against him for the full amount of the alleged debt! As a public record, the judgment can stay on his credit for up to 10 years, unlike most accounts which are limited to 7 years under the Fair Credit Reporting Act.
If Mr. B— had only hired a real lawyer to help him, he would not have had to face his collection lawsuit alone. He would have had real advice and real representation. But we lawyers don’t have the advertising budgets of big nationwide corporations like Freedom Debt Relief. Hopefully others will learn from his experience.
If you are thinking about hiring Freedom Debt Relief or any other debt settlement company: think long and hard before you sign up with them! They cannot do anything you can’t do. They may be working for the credit card companies. Your creditors are NOT obligated to deal with them instead of you. They can’t do a thing to protect you if your creditors decide to take you to court.