The state of Indiana may have to step in and help the former customers of a debt management company that closed last month.
Debt Doctors, a company in Lafayette, closed last month and several former customers have said that their debts have not been paid in several months. According to reports, the business’ owner died on June 3. The Lafayette Journal and Courier interviewed several Debt Doctors customers, who said they’re now being hounded by debt collectors and debating bankruptcy.
“We don’t want to do something like that, but if it comes down to it, that’s what we’re going to do,” said Margie Engle of Lafayette to the paper about filing for bankruptcy. “[Creditors] call constantly. They want more than what we afford to give them.”
The Journal and Courier reported that the company is backed by a $50,000 surety bond that could be used to repay customers, but the Indiana Department of Financial Institutions (DFI) would have to review and investigate all claims in order for customers to receive any form of reimbursement. DFI officials said it will be the first time they’ve ever really had to go through a claims process for a debt settlement company.
“Obviously we’re going to try to expedite the process,” said Mark Tarpey, DFI consumer credit division supervisor, to the Journal and Courier. “It can get to be a little tricky. Since we haven’t been through this, we’re not really sure (when the process will conclude). We’re going to do our best. The end of the year seems like a realistic goal.”
It’s important to be able to trust the people who deal with your finances. Debt settlement and debt management companies have poor track records when it comes to customer service. Later this week, we will talk about the complaints we hear the most about these companies, as well as the benefits of bankruptcy, which puts an end to collection attempts through an automatic stay.
If you have large amounts of debt, bankruptcy is an option. Visit our website for more information about the benefits of bankruptcy, or call us at (202) 483-6070 to schedule an appointment.
Law Firm of Kevin D. Judd– Washington DC and Maryland bankruptcy attorney