Debt Settlement USA helps clients in Valley, 45 states - East Valley Tribune: Business

Debt Settlement USA helps clients in Valley, 45 states

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Posted: Sunday, February 5, 2006 5:49 am | Updated: 4:40 pm, Fri Oct 7, 2011.

Ted and Adam Brauer admittedly have yin and yang personalities.

Their respective bright and dark sides helps them get along nicely, thank you, especially when confronting a familiar monster — financial turmoil.

But besides their Chinese philosophical characteristics, there is another reason Ted and Adam Brauer work so well together.

Ted is Adam’s father and Adam is the son of Ted.

They are also co-founders of one of the nation’s fastest-growing debt management company — Debt Settlement USA of Scottsdale.

“As a father-and-son team, we feed off each others’ strengths,” said Adam, 39, an attorney.

“Yes, we’re yin and yang,” said Ted, 67, a veteran entrepreneur. “We don’t argue. We work together.”

Last year, the father-and-son team and their more than 50 employees cooperatively negotiated settlements of more than $12 million with creditors for their 4,500 clients nationwide.

The ultimate goal of Debt Settlement USA is to help financially-troubled clients avoid bankruptcy.

They usually accomplish this by acting as mediators and reaching an agreement between the creditors and the clients to reduce the debt and to repay it over an agreed period of time.

But the company also helps the client develop a financial plan aimed at avoiding future setbacks.

“Our program not only helps creditors getting repaid more than they would have if the client had to file for bankruptcy, but it also establishes a budget so the client can try to avoid future financial dilemmas,” said Ted Brauer, whose business career began more than four decades ago in the textile industry in New York City.

“Generally, people in America are taught to hate going bankrupt,” said Ted Brauer. “It’s a very emotional issue.”

Clients must agree to pay 12 percent of the debt they bring into the program. Therefore, a debt of $12,000, for example, would cost the client $1,440.

However, the total debt is usually lowered through negations between Debt Settlement USA and the creditors, mostly credit card companies, sometimes by as much as onehalf or more.

The company does not hold the funds, but is paid by their clients after a settlement is reached, said Ted Brauer.

Their clients pay the agreed-upon balance directly to the creditors.

The Brauers started their company in August, 2003 in their apartment in Scottsdale. They began with a couple of computers and, explained Adam, a single milk crate used to hold files.

His father, who moved from his native Woodcliff Lake, N.J., to Scottsdale eleven years ago, started several business enterprises before his son, who specialized in civil law in New Jersey, including bankruptcy, moved to the Valley about four years ago.

The elder Brauer was among the first to enter the silk mill industry in China in the 1980s. He later established a national mail order company selling Beta movies.

His son, meanwhile, worked for six years in Hollywood as a television screen writer and producer until he decided to join his father and co-found the debt settlement business in Arizona.

“We combined our experience with the law, people and business to form a new company that is becoming very successful,” said Ted Brauer.

After establishing their apartment-based office, the Brauers’ company, primarily on the Internet, eventually moved into a 5,000-square foot office in the Kierland Corporation Center, 7047 E. Greenway Parkway, Scottsdale.

Very few clients meet face-to-face with company debt mediators, although some have visited the busy office in north Scottsdale.

They soon will moved into an 18,000-square foot new office at 16430 N. Scottsdale Road, Suite 400 and expand their staff as well as customer base.

“We expect our business to expand three-fold,” said Ted Brauer, who will soon launch a new division, Settle Business Debt, aimed at helping smaller firms reduce their debts.

The Brauers said the debt settlement business virtually exploded nationwide recently following changes in U.S. bankruptcy laws that makes it more difficult to file for protection.

As a result, more debtors are unable to escape the problems associated with debt in courts, but they have to face other hardships such as putting their assets, including homes, cars and other valuables, in jeopardy.

Also, the re-mortgaging of homes through equity loans have put many clients in debt after spending the extra money they received and are now facing higher home loan interest rates.

“These are the people that we say are using their homes as an ATM,” said Adam Brauer.

“We expect the debt settlement industry to grow even more since the layoffs of auto workers,” predicted Ted Brauer.

They said that many credit card companies, too, are raising their required minimum monthly payments, raising the debt level of buyers and their overall debts.

The Scottsdale company provides services in 45 states, including Arizona.

“We don’t accept all customers,” said Adam Brauer. “Some are turned away for various reasons, including people who just aren’t prepared to live within a budget. Some people just can’t do it.”

They are also a member of the Better Business Bureau of North Central Arizona.

Ted and Adam Brauer

Age: 67 and 39

Family: Father and son; mother, Diane; Adam is eldest of five Brauer children

Resides in: Scottsdale

Business: Co-founders, Debt Settlement USA, 7047 E. Greenway Parkway, Scottsdale

Key achievement: In 2005, their company negotiated and settled more than $12 million in debt that netted clients about $6 million. The company has more than 4,500 clients nationwide. It started in 2003 in a rented apartment with two part-time employees and today has more than 50 who are preparing to move from a 5,000-square foot office to a new Scottsdale location three times as large

Success Philosophy: Hire employees who care about your clients and offer clients an honest alternative to their financial problems

Information: (888) 444-4550, (480) 556-9090 or www.debtsettlementusa.com

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