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I am an Licensed Life Insurance Broker, many of my clients

Customer Question
are in financial trouble with...
I am an Licensed Life Insurance Broker, many of my clients are in financial trouble with their credit cards. They need advise on how to work with credit card companies to come to settlements. I know how to help them. I don't want to charge theim outrageous fees like these debt consolidation companies do. I just want to give them advice and may have to speak to these credit card companies on their behalf because they are too nervous and afraid to do it themselves. My time is valuable, so I would like to charge them a fair fee.
What are the laws regarding consulting in such a manor. I don't want to jepordize my license. I have already looked into getting an debt adjuster's license and that requires a
$50,000 surety bond. I don't want to have to spend that kind of money.
Do you have any answers for me?
thanks
Mark
Submitted: 7 years ago.Category: Legal
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3/19/2010
Lawyer: Law Pro, Attorney replied 7 years ago
Law Pro
Law Pro, Attorney
Category: Legal
Satisfied Customers: 24,870
Experience: 20 years legal practitioner: real estate, collections, estate, civil, business, and criminal law
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You asked:

 

What are the laws regarding consulting in such a manor?

 

The laws concerning such can be located at this link for the state of NJ:

 

http://www.state.nj.us/dobi/banklicensing/debtadjusterfaq.html

 

 

"Debt Adjuster" means a person who either (a) acts or offers to act for a consideration as an intermediary between a debtor and his creditors for the purpose of settling, compounding, or otherwise altering the terms of payment of any debts of the debtor, or (b) who, to that end, receives money or other property from the debtor, or on behalf of the debtor, for payment to, or distribution among, the creditors of the debtor.

 

So, you have to be registered non-profit corporation to have a debt consulting business.

 

 

Now, charging them a consultation fee and telling them what they should say would NOT make you a debt adjuster - you could do that without fear of liability. You cannot communicate or negotiate or act in any way as an intermediary between they and the creditors.

 

 

So, it would seem that NJ is one of the few states that have or take some type of control of debt consolidation companies and the like.

 

It would seem that unless you went into the business on a full time basis that it just wouldn't be to your economic benefit to do such - but only you know how much business you could or would generate.

 

Operating a non-profit business does not mean that it's employees can't make good money. To the contrary, look at the executives of many non-profit companies - ie. Red Cross or the Salvation Army or the United Way - their executives make huge monies.

 

 

 

 

 

Please click on the ACCEPT button for my answer so that I receive credit for assisting you. You may continue to ask follow-up questions after accepting. If the information is helpful, I would very much appreciate positive feedback. Bonuses are also appreciated.

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Customer reply replied 7 years ago

 

 

I have over 800 clients and many of them are in credit card trouble. If I advise them, on how to make a settlement with the companies and charge them for example $250.00 consultation fee and another fee of $250.00 when they have successfully completed their payment arangements should I make up some kind of legal contract for my services? Also can I be held liable for any advice I give them? If they give their permission is it ok to speak to their creditors on their behalf? Many of them are too nervous to do so?

Lawyer: Law Pro, Attorney replied 7 years ago

It does seem like a little bit high of a price for them to pay - but that's their decision and what you want to charge under the circumstances.

 

Yes, certainly you should draft an agreement with them - that would hold them liable to pay the balance of the fee.

 

Yes, there's always the chance of being held negligent or of giving the wrong advice - you would need your own liability insurance policy in the matter. However, in reality, I very much doubt that they would be successful holding you liable for your advice in the matter.

 

Absolutely NOT - you cannot speak or act as an intermediary in any way shapre or form between they and the creditor UNLESS you comply with the NJ state statute.

 

 

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Customer reply replied 7 years ago

Do I need to go to a lawyer to draft this agreement or can I draw up an agreement and just get it notorized.?

Customer reply replied 7 years ago
Do I need to have a legal document drawn up as an agreement or can I draw one up myself and just have it notorized?
Customer reply replied 7 years ago
Relist: Incomplete answer.
I am asking if I need to have a legal document drawn up for an agreement and am not receiving an answer
Customer reply replied 7 years ago
Relist: Incomplete answer.
Customer reply replied 7 years ago
Relist: Incomplete answer.
I have not received an answer to a follou-up question.
Lawyer: Law Pro, Attorney replied 7 years ago

Sorry, someone came in and took over the question or something. Your follow-up didn't show up.

 

You asked:

 

Do I need to go to a lawyer to draft this agreement or can I draw up an agreement and just get it notorized.?

 

First, you don't need the agreement notarized - this wouldn't be as dificult as a life insurance contract.

 

Second, you can draft the agreement yourself.

 

Here is an example of such - just fill in the blanks:

 

AGREEMENT BETWEEN

You

&

Client's name

 

The parties agree that the above named is employed to discuss the following matter.

 

Fees are to be at $ per hour.

A fixed fee of $ will be charged.

 

Billing and payment times:

Additional times:

The parties further agree that:

1. That the advice given is not to be construed as legal advise in any way; and

2. That the client is to seek the advice of independent legal counsel if unsure of anything in the matter.

Agreement Date:

 

Client:

 

Client:

 

Consultant:

 

Ask Your Own Legal Question
Lawyer: Law Pro, Attorney replied 7 years ago

Sorry, someone came in and took over the question or something. Your follow-up didn't show up.

 

You asked:

 

Do I need to go to a lawyer to draft this agreement or can I draw up an agreement and just get it notorized.?

 

First, you don't need the agreement notarized - this wouldn't be as dificult as a life insurance contract.

 

Second, you can draft the agreement yourself.

 

Here is an example of such - just fill in the blanks:

 

AGREEMENT BETWEEN

You

&

Client's name

 

The parties agree that the above named is employed to discuss the following matter.

 

Fees are to be at $ per hour.

A fixed fee of $ will be charged.

 

Billing and payment times:

Additional times:

The parties further agree that:

1. That the advice given is not to be construed as legal advise in any way; and

2. That the client is to seek the advice of independent legal counsel if unsure of anything in the matter.

Agreement Date:

 

Client:

 

Client:

 

Consultant:

 

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Customer reply replied 7 years ago
ok thank you for your help
Lawyer: Law Pro, Attorney replied 7 years ago

OK, sorry for any confusion in the matter.

 

Good luck!!

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