Debt Pooling Law and Legal Definition
Debt pooling is an arrangement by which a debtor would deposit funds for the purpose of distributing such funds among his creditors. It is a method of debt consolidation. It is unlawful for any person to solicit in any manner a debt pooling.
The following is an example of a state statute (Oklahoma) defining the term:
24 Okl. St. § 16. Debt pooling
Debt pooling is defined as making a contract with a particular debtor whereby the debtor agrees to pay a sum or sums of money periodically to the person engaged in the debt pooling who shall distribute the same among certain specified creditors in accordance with a plan agreed upon and the debtor further agrees to pay such person any valuable consideration for such services or for any other services rendered in connection therewith.
