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Thursday, Jul 27, 2017
Local News

This debt collector has a heart

SARASOTA - Alex Nathan has something in common with the underwater homeowners he tries to help: The 30-year-old debt mediator and collections specialist has been there himself. Four years ago, Nathan lost his job as a home-improvement consultant for Sears and ended up moving into the Salvation Army's Sarasota homeless shelter with his father, who had a similar run of bad luck. With a broken laptop that would only recharge if held a certain way and a cellphone that would shut down on the 17th of every month until he paid $40 to turn it back on, Nathan battled to get his head above water financially. He got a temporary job as a debt mediator, in which he attempted to help people consolidate and reduce their debts. A short time later, he saw an article in the Herald-Tribune about how collections multimillionaire and angel investor Harvey Vengroff was offering free office space to entrepreneurs in return for a stake in their businesses.
A week after their first meeting, Vengroff called Nathan and told him he saw some synergies with what the young man was doing. "I got dressed at the homeless shelter and went to his office, where I met with his entire board," Nathan said. "I said a little prayer and the next thing I know, they have me going over the details of my business plan on a whiteboard." Since then, Nathan's debt-mediation business, Legal Debt Solutions, has taken off. The company helps people who have unmanageable credit card bills reduce their payments and, with Vengroff's backing, offers options for people underwater on their mortgages. Jennifer Currier, 31, a nurse and a single mother of three, is one of the people who Nathan and Vengroff have helped. An admitted shopaholic, Currier said she had run up high credit card bills during the economic boom of the mid-2000s. At the same time, she was trying to help a sister with financial problems. She struggled to pay her $1,250-per-month rent, and hospital, automobile, insurance, telephone, utility and babysitting bills. Nathan and Vengroff found her a refurbished house off Bee Ridge Road that she could rent for $900 a month with an option to buy. They also worked to reduce her debts and to improve her credit. "I'm a shopaholic and telling myself 'no' is extremely hard," Currier said. "But I realized that at some point I had to grow up and get on the ball and have something to show for it." For Nathan, Currier typifies the people who got into trouble during the housing bubble. She is also emblematic of their desire to make things right, he said. Both Nathan and Vengroff freely acknowledge they make a lot of money by helping people cut their debts. If someone owes $100,000 in credit card bills, Nathan and Vengroff can earn as much as $10,000 over a two-year period by reducing that person's total debt. "We get 5 (percent) to 10 percent of their total debt paid over 24 to 48 months," Nathan said. Like other debt consolidators, Nathan and Vengroff take one person's debts and pool them with hundreds of others in the same situation. They then negotiate with creditors such as Visa or Bank of America to cut the debt of all the people in the pool. The creditors benefit because the debtors do not seek bankruptcy, in which the court can wipe out the debts, Nathan said. The debtors benefit because they discharge some debts and can begin to repair their credit. Rather than being ashamed of the financial problems he went through, Nathan wears them as a badge of honor. Nathan was laid off at Sears in 2008. He lost his house shortly after, and he lived out of his car and on friends' couches before moving into the Salvation Army's homeless shelter. Even after landing his first debt-mediation job, his troubles were not over. His employer stiffed him out of a commission that he had earned, Nathan said. That was when he decided to provide the same services on his own. Every day, he would get up at 5:30 a.m., take the bus to a Starbucks and make calls and return emails from clients and their creditors.
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