DEBT RELIEF OPTIONSAPPLY ONLINEARTICLESPRIVACY POLICYFAQCONTACT USHow can I become a client of debt settlement program?
The first step is to fill out our online application form. Our Debt Counsellor will contact you as soon as possible. You will get a free consultation and a detailed financial analysis, in order to evaluate if you benefit from this program. Then you should make a decision if you want to be putted in a debt settlement program, and let us help you to make your life easier. From our side we will consider you as candidate for the accepting you into our program too. After agreement of both sides about collaboration we will immediately start to work.
Is debt negotiation the same as customer credit counseling?
No. Credit counseling will have no effect on your principal balance. In credit counseling you compensate the debt in full, at reduced interest rates. But your payments are still rather high and it takes you approximately 5 years to pay off the debt. And this is not the best way to reduce you debt amount, because it is a very long process, such way probably does not meet your best interests, but is largely supported by your creditors. And the most negative effect is that you can damage your FICO score. However, you will receive a negative mark on your credit report, a CC or Credit Counseling mark. This is viewed negatively by lenders and may damage your creditworthiness.
What are the creditor's incentives?
The creditor's primary incentive is to recover funds that would otherwise be lost if the debtor filed for bankruptcy. The other key incentive is that the creditor can often recover more funds than through other collection methods. Collection agencies and collection attorneys charge commissions as high as 40% on recovered funds.
What debts can be negotiated?
Debt negotiation is applicable to debts such as:
- Unsecured credit cards
- Medical bills
- Payday loans
- Personal loans
- Store cards
- Bounced checks
- Student loans can be negotiated if they are not insured by the Federal Government.
What is Unsecured Debt?
Unsecured debt refers to any type of debt or general obligation that is not collateralized by a lien on specific assets of the borrower in the case of a bankruptcy or liquidation.
What is Secured Debt?
A Secured Debt is a loan where the creditor retains a security interest in an item of real or personal property such as a house. If you fall behind on this type of debt, the lender can repossess collateral in order to collect on their outstanding debt.
How long does the settlement program take?
The period of time that we need for implementation of the program varies from case to case and will depend very much on your budget. Depending on the monthly payment you decide upon, the debt can be eliminated as soon as you can come up with the necessary funds. It can happen in 100 days, but a typical program usually takes 12-36 months, but as many clients as many approaches.
Can Debt Negotiation make injury my credit?
As a reasonable person you should understand that any form of debt settlement will not have a positive effect on your credit. In accordance with debt negotiation program you should stop paying creditors till you have gathered enough funds to settle the debt. So you likely receive an 'open delinquency' on your credit report because you will not make regular payments to your creditors. And we can do nothing because creditors don't agree to negotiate the debt until and unless you're behind for 3 months or more. Our program will eliminate your debts, and certainly improve your debt to income ratio. This ratio is used by lenders to determine your creditworthiness. So when your debt will be settled, your credit score will improve gradually with time. And your future creditors will see you have done you best in order to resolve your debt instead of filing bankruptcy. You should understand that our first aim is to get you out of debt as quickly as possible, and credit is a secondary concern.
In what way my creditors will take money during the program?
We do NOT pay funds to your creditors during the program. We are not a credit counseling program. The object of our debt management program is to negotiate your debts at a discount to the principal balance, and during the program regular payments are not made to your creditors, we can not negotiate significant settlements on current accounts. But If you can afford to pay off your debts on your own, you should do so. Once you approve a negotiated settlement offer, you will then make settlement payments directly to your creditors from your settlement account. The settlement account is an account that you control at your bank.
And if I want to take a loan?
We can't dissuade you from this borrowing, but advice you to weigh all pros and cons, because loan can only complicate settlement program. And there is an opportunity to lose your collateral in the case of secure loan, and this collateral can be your house, it's very risky in such a situation.
Does debt negotiation have drawbacks?
We can't keep conceal that you should be ready for a more difficult short term struggle, FICO scores can suffer initially, and you must commit to a more fiscally responsible lifestyle. This is why we are also committed to providing you with a quality of service, expertise, and value without rival in the debt reduction industry. We are recommended and praised across the internet and the long-term relationships we have developed with the credit card companies and collection agencies have firmly established company's reputation for results.
Is there probability to be sued?
Lawsuits sometimes happen, but it is not a common occurrence. Usually creditor can only sue you if it retains an attorney in your state, and in any case lawsuits take a lot of time and money. And even if creditor decides to apply this legal method, they can only collect what you actually have. So in summary, it is more reasonable and more effective let customer provide debt settlement than sue. We never exclude the possibility for our client to be sued, obviously a bank has the right to sue and collect the money owed to them, but most often if you keep the lines of communication open, even if through your negotiator, the likelihood of being sued is minimal. We work with your creditors to find a solution that will satisfy everyone before legal action is taken. While we cannot guarantee that legal action will not be taken, we are confident that our experience can avoid it.
Will you settle all my creditors?
We will contact with most your creditors and try to establish relationships with all of them but everything will depend on ones willingness to settle and at what percentage. Every creditor will be considered as a unique case, and we will not accept into our program creditors that we don't see any reason to work with.
Do I have to include all of my debts in your program?
It's completely your decision what debts should be included in the program, but we recommend that you include all or most of your unsecured debt, and it is important that you tell our counselor about all other unsecured debt you have. It may effect our ability to negotiate if you make payments to a creditor that is not included in our program, while not paying creditors in the program.
What about bankruptcy?
Bankruptcy is an option that should only be explored as an absolute last resort to solving your financial problems. This is not a decision to be considered lightly. Bankruptcy will remain on your credit record for approximate 10 years and seriously affect your ability to be approved for credit. Even after a bankruptcy has been removed from your record, you are still required to disclose it on forms and applications; even applications for employment. Bankruptcy can have an adverse effect on your life and lifestyle long after the legal matters are over.
What are the tax consequences?
Banks are supposed to report canceled debts exceeding $600 to the IRS and you are supposed to report the same as income on your annual tax return. However, the IRS permits you to write off any "income" from canceled debts up to the amount by which you were "insolvent" at the time. So unless you have a positive net worth, which is highly unlikely if you're deep in debt, then you ordinarily won't have to pay taxes on the forgiven amounts. You should consult your own tax advisor for advice specific to your situation.
Will I still be able to use my credit cards?
You will have to close all unsecured accounts, this is a must condition participation in Debt Settlement Program. But you will be able to keep ONE emergency credit card. Use of this card must be restricted to emergency purposes.
How much does debt settlement program cost?
Debt settlement fees depend upon the number of credit accounts you have, the debt amount you owe and the amount you can save through negotiation. Some companies may charge 25%-35% of what you save.
What if I cannot afford to pay the settlement?
If you do not have the funds available for a settlement, then no settlement is made. You should understand that you are the first person who will benefit from debt eliminating. We develop a financial plan that can help you to settle your debts as soon as possible, and you need to make an effort to follow this plan. We form a partnership to help you solve your financial situation. Without an effort on your party, you debt will not disappear and we cannot settle.
Is there any guarantee for debt settlement service?
You should understand that any debt settlement company can not absolutely guarantee any specific settlement amount, but for sure they will help you in most cases. A good debt settlement company will use tried and tested protocols that consistently produce successful outcomes. But past performance unfortunately is no guarantee of future results. If the company cannot negotiate a settlement on a debt, you should not have to pay a fee, or the fee that you paid should be refunded.
I own a home with equity. How can this be used to help with debt settlement?
If you have available equity in your home we may be able to help you use this as a means to gather money for settlement more quickly. Our counsellors will provide you with detailed information about this opportunity, ask them.
Can I expect for completely confidence?
We are committed to maintaining complete confidentiality and privacy. Feel free to read our comprehensive privacy policy found on this site.
