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socrateaser
socrateaser, Lawyer
Category: Consumer Protection Law
Satisfied Customers: 38801
Experience:  Retired (mostly)
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Someone from Lexington Consumer Advocacy contacted me due to

Customer Question

Someone from Lexington Consumer Advocacy contacted me due to online loans which I have 4 with interest rates that showed up later over 600%. They told me to put a hard freeze on my checking acct or close it and they would take care of the loans. They of course want 348. then 341 for 5 months to do this. My question is are the legal, can this be done, or did I just get myself in a lot of trouble for closing all accounts at the bank and then they had the money returned to my new account. thanks Kathi Schmitt
Submitted: 1 year ago.
Category: Consumer Protection Law
Expert:  socrateaser replied 1 year ago.

Hello,

Lexington Consumer Advocacy appears to be a debt relief agency, which is another way of saying that if you pay them a monthly fee, they will try to negotiate with your creditors to reduce or eliminate your debts. This is a legal business model, however, as a general rule, the fees charged by this type of agency are usually as costly as the original debt. The result is that you get a reduced debt from the original creditor, but you transfer the value of that obligation to the debt relief agency, who you will owe for the services in negotiating the debt.

Concerning the closure of your bank accounts as a means of avoiding continued payment of debts you can't afford to pay, you're entitled to protect your assets. The various creditors may send your loans to a debt collector, and you may be harassed for payment, but in the end, you can frequently negotiate with a debt collector for a much lower settlement amount. And, if that doesn't work, and you run out of other options, you can file for bankruptcy and wipe out all of your debts, once and for all.

I hope I've answered your question. Please let me know if you require further clarification. And, please provide a positive feedback rating for my answer -- otherwise, I receive nothing for my efforts in your behalf.

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Expert:  socrateaser replied 1 year ago.

Hello again,

I see that you have reviewed my answer, but that you have not provided a rating. Do you need any further clarification concerning my answer, or is everything satisfactory?

If you need further clarification, concerning this matter, please feel free to ask. If not, I would greatly appreciate a positive feedback rating for my answer -- otherwise I receive nothing for my efforts in your behalf.

Thanks again for using Justanswer!

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