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Thread: Information on starting a debt consolidation company

  1. #1

    Default Information on starting a debt consolidation company

    Hello Everyone!

    I am brand new to this forum. I searched but could not find anything related to what I am looking for.

    I am looking to have a conversation with someone who has experience at the executive level of a debt consolidation company or who has started a debt consolidation company themselves. I currently own a staffing company but am interested in starting a debt consolidation company for when the economy takes a dive.

    Questions regarding the following:
    - licensing, accreditation, as well as federal and state laws regarding the business
    - Call Center best practices / outsourcing call center
    - marketing plan
    - Do I contract with credit card companies/debt collecting agencies?
    - partnering with financial institutions to offer debt consolidation loans (essentially act as a broker and sell the paper)

    Any help is very much appreciated and I look forward to participating in this forum.

    Thank you!

  2. #2

    Default

    Hi! Welcome!

    What an interesting offshoot venture you are considering. Would this be personal debt consolidation or business debt consolidation?

  3. #3

    Default

    Quote Originally Posted by Melanie O View Post
    Hi! Welcome!

    What an interesting offshoot venture you are considering. Would this be personal debt consolidation or business debt consolidation?
    I am leaning towards personal debt consolidation.

    In my mind I picture it being relatively cheap to start with an outsourced call center in the Philippines. Again, I have no idea regarding regulations so I am very interested in speaking with someone who has intimate knowledge in the industry.

  4. #4

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    Can you tell me what your definition of debt consolidation is?

    If you are talking about something that includes helping consumers negotiate down their debts with creditors, then yes, it's a very regulated industry that requires licensing. I would call this debt settlement.

    If you are talking about simply offering large loans that a consumer can use to consolidate all of their pre-existing existing loans, different states have different laws. You will likely need to apply for licensing in various states.

  5. #5

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    Debt consolidation industry is considered high risk owing to the high chargeback rate. Reason behind this are debt consolidation companies who don’t know how to manage chargebacks or who don’t work with experienced high-risk processor and gateway. Despite this, there are merchant service companies who provide debt collection credit card processing like paycron.

    From marketing point of view, Marketing debt consolidation services in a very competitive market employs different marketing strategy. Marketing needs to focus on putting across the advantages of the products and services offered. Most debt consolidation companies use traditional methods like print advertisements, brochures and advertisement in community newspapers. Television, radio and trade shows are also used to promote debt consolidation services. Now companies are using internet based strategies like SEO optimized website, search engine advertisement, mobile phone ads, pay-per-click, banner ads and Facebook ads with catchy titles.

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