What fees are charged to complete the debt settlement program?
Fees depend on the debt consolidation solution provided. Each case varies based upon the complexity of your financial situation and the effort required by the debt-free plan you decide upon. This will be discussed with you in detail during the free consultation. It is important to note that any fees charged to you now will result in later savings when you pay a fraction of your current debt interest fees.
Will my creditors stop harassing me?
Yes. After you agree to a debt management plan, we send a letter to each of your creditors
advising them that you have retained a debt advisor to represent you. We will demand that they cease all communication with you directly and we will demand that all future correspondence be directed to our office on your behalf.
Will debt consolidation affect my credit rating?
Debt consolidation and debt settlement are bankruptcy prevention solutions. While debt consolidation may improve your credit history, debt settlement may not if your debts are current and you have no history of late payments. The debt settlement solution, however, will improve your debt to income ratio in the long run, and may therefore improve that portion of your credit score. Future creditors will see that you settled debts rather than file bankruptcy. Bankruptcy is far worse than settlement. Consolidating debts is the best solution.
Do my debts need to be past due in order to seek debt management credit counseling?
No. Any consumer with credit card debt can seek advice and find some benefit, even if consolidation or settlement is not required. We advise consumers in all stages of debt accumulation.
Is there a difference between debt settlement and debt consolidation?
Yes. Debt consolidation leaves you with one low-rate loan to you to pay off all of your debts. The interest on this loan is lower than your credit cards, so although your principal balance remains the same your interest rate is greatly reduced. Because of this you can pay off the debt in less time. Debt settlement negotiators will negotiate on your behalf to significantly reduce the principal and interest on your debt. In most cases you will only pay a fraction of what you owe. Generally, debt settlement negotiators get you out of debt faster than consolidators, but can lower your credit report score.
Can secured debt turn into unsecured debt?
That depends on how you structure your debt consolidation loan. If property that is being used to secure multiple loans is seized by one creditor, then any other loans tied to that same property may become unsecured debt. The consumer may owe a deficiency balance if the sale of the property does not cover all debts secured by the property. The loan amount deficiency becomes an unsecured debt. Exceptions may apply and will depend on the security interest loan agreement.
Do you guarantee that debt counseling will end in successful negotiation with all my creditors?
No legitimate debt relief firm can guarantee that every creditor will accept an offer to
satisfy your outstanding debt, even when you enter debt counseling. Because we maximize collective years of experience from established firms who have settled millions of dollars of debt we offer our applicants a broader range of options and choices. After your free consultation with our debt advisor, we will know your financial situation and be able to advise you what to expect from the program.
Can all my debts be eliminated by following your advisor's debt management plan?
When you follow the custom debt management plan we provide you, you can expect to have zero
balances in a prescribed amount of time on all unsecured accounts that you have contracted us to resolve. You will still be responsible for unsecured debts you chose not to include in our plan and your secured debts such as mortgages, auto loans, etc.
Does debt consolidation allow me to choose the debts I'd like you to resolve or do I have to include everything?
Your debt management plan will allow you to choose what debts to settle and how best to settle them. During your free consultation it's best to set out all the debts you have, even those you may not want us to settle on your behalf. Taking your monthly cash flow (in and out) into consideration is essential to crafting a plan to make you debt free.
How can I be sure that debt consolidation will work?
With debt consolidation, the bottom line is that it is up to you. We can make a plan that will guarantee you are out of debt, but you must take the steps outlined by an advisor and follow the plan provided. We know we can make a plan. You must make the monthly commitment of keeping to this plan until you are at zero debt. During your free consultation, an advisor will speak with you about keeping to the plan provided.
How long does it take to be debt free?
Debt settlement is different for everyone. The length of time it takes varies depending upon the amount of your debt, how much is consolidated or settled out and availability of your funds to resolve your debt. This will be discussed during your free consultation and the final plan will layout a timeline for your specific situation.
Do my credit card debts continue accruing interest charges?
Yes. But the interest rates and in some cases principal balances are lower after debt consolidation or settlement. Lower rates and balances allows you to be debt free faster than continuing to pay monthly minimum balances that can extend for decades. Skilled debt consolidators and negotiators can actually get your creditors to remove charges such as late fees and negative credit reporting.
How do secured debt and unsecured debt differ with debt consolidation?
When a creditor has a security stake in real estate or personal property such as a house or
automobile, the debt is secured - even if the purpose of the loan is debt consolidation. If a bill goes delinquent on a secured debt, the lender may repossess the property in order to pay for the losses. If the losses are greater than the value of the item sold, you can remain liable for the difference. This is called a deficiency balance. Home loan laws vary by state and not all mortgage terms are the same. Seeking legal counsel to protect your real estate interest is strongly urged.
An unsecured debt, such as credit card debt, is open credit or a cash advance allowing you purchasing power based on your promise to repay the loan. Credit cards are the most common unsecured debts. Medical loans and personal loans are also common unsecured debts. Creditors of unsecured debts must seek legal action for debt settlement when borrowers are delinquent on payments.
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