Anyone used 4pillars.ca for debt consolidation?
June 3, 2010 9:35 AM Subscribe
Anyone used 4pillars.ca for debt consolidation?
I've got a significant amount of credit card debt--$11,000@12% and $7000@19%. I make about 35K and can afford payments of about $500/mos. My credit score is okay (considering the amount of debt I have) but my bank turned me down for a debt consolidation loan citing that my income is too low.
I found 4pillars.ca through a local periodical (I live in BC) and looked them up on the BBB (they have a rating of A+). I'm not interested in negotiating to pay a percentage of my total debt. I want to pay the whole balance, just at better rates. Has anyone used 4pillars.ca to help them negotiate with creditors? Is there something else I should be considering?
Throw away email: is.4pillars.good@gmail.com
I've got a significant amount of credit card debt--$11,000@12% and $7000@19%. I make about 35K and can afford payments of about $500/mos. My credit score is okay (considering the amount of debt I have) but my bank turned me down for a debt consolidation loan citing that my income is too low.
I found 4pillars.ca through a local periodical (I live in BC) and looked them up on the BBB (they have a rating of A+). I'm not interested in negotiating to pay a percentage of my total debt. I want to pay the whole balance, just at better rates. Has anyone used 4pillars.ca to help them negotiate with creditors? Is there something else I should be considering?
Throw away email: is.4pillars.good@gmail.com
This post was deleted for the following reason: -- LobsterMitten
I've no direct experience with 4pillars.ca, and my experience is US-based, but hopefully this is still helpful:
Most of these outfits are scams, or offer such a poor value that they might as well be scams. A negative BBB rating is good for picking out the worst offenders, but all a good rating means is that they know how to respond to complaints in a way that keeps the BBB happy. It doesn't mean it's not a terrible deal.
Their Web site looks more professional than most, and discloses more detail, but - "franchise opportunities?" That's your tipoff that what they do isn't particularly difficult. You sound more than articulate and resourceful enough to do basic negotiation, and that's all you really need to do. Sure, they have more experience, but I can assure you there are no secret formulas or special arrangements with creditors to be had.
Their FAQ, under "4 Pillars Questions," strongly implies that they'll push you towards trying to accumulate a lump-sum settlement for a percentage of the amount owed. If they're like most debt settlement companies, they charge a hefty up-front fee, in addition to a percentage of the amount forgiven - which you may be taxed on. (I'm not sure how that works in Canada.)
So, what should you do instead? Like halogen said, just call your bank and tell them you'd like a lower interest rate so you can pay off and close your cards. It's entirely possible that they'll just give it to you, with minimal damage to your credit. If not, check out a NON-PROFIT consumer credit counseling service. They're out there, they're the good guys, and they know the magic words.
Failing that, please don't be ashamed to try for lump-sum debt settlement. This is all cold, cold business for them; why shouldn't it be the same for you? Don't be afraid to do this yourself. Just read a little bit about basic negotiation - it doesn't take much. Maybe check out Fisher & Ury's Getting to Yes; I generally loathe business self-help books, but it's no-nonsense and pure gold.
N.b. I am not your lawyer; this is not legal advice.
Good luck!
posted by Parade of Horribles at 8:05 PM on June 3, 2010
Most of these outfits are scams, or offer such a poor value that they might as well be scams. A negative BBB rating is good for picking out the worst offenders, but all a good rating means is that they know how to respond to complaints in a way that keeps the BBB happy. It doesn't mean it's not a terrible deal.
Their Web site looks more professional than most, and discloses more detail, but - "franchise opportunities?" That's your tipoff that what they do isn't particularly difficult. You sound more than articulate and resourceful enough to do basic negotiation, and that's all you really need to do. Sure, they have more experience, but I can assure you there are no secret formulas or special arrangements with creditors to be had.
Their FAQ, under "4 Pillars Questions," strongly implies that they'll push you towards trying to accumulate a lump-sum settlement for a percentage of the amount owed. If they're like most debt settlement companies, they charge a hefty up-front fee, in addition to a percentage of the amount forgiven - which you may be taxed on. (I'm not sure how that works in Canada.)
So, what should you do instead? Like halogen said, just call your bank and tell them you'd like a lower interest rate so you can pay off and close your cards. It's entirely possible that they'll just give it to you, with minimal damage to your credit. If not, check out a NON-PROFIT consumer credit counseling service. They're out there, they're the good guys, and they know the magic words.
Failing that, please don't be ashamed to try for lump-sum debt settlement. This is all cold, cold business for them; why shouldn't it be the same for you? Don't be afraid to do this yourself. Just read a little bit about basic negotiation - it doesn't take much. Maybe check out Fisher & Ury's Getting to Yes; I generally loathe business self-help books, but it's no-nonsense and pure gold.
N.b. I am not your lawyer; this is not legal advice.
Good luck!
posted by Parade of Horribles at 8:05 PM on June 3, 2010
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4pillars is a for-profit "debt settlement" service: "We have successfully helped restructure the debts of over 8000 clients, with settlements averaging 25% of original debts owed. Most of our clients are honorable debtors who have chosen to show some restitution to creditors, thus avoiding bankruptcy."
Try calling your creditors, closing all of your accounts (reducing your overall available limit might hurt your credit score initially but clearly you have another priority right now) so that you can still make payments but can no longer spend money, and ask that they grant you lower interest rates. It worked for me (0%-%6 current interest rates). Also, consider getting a second part-time job so you can afford more than $500 a month.
posted by halogen at 11:04 AM on June 3, 2010