Debt Relief Frequently Asked Questions

What is Debt Settlement?

Debt settlement, also known as debt negotiation, is a debt management approach where the amount is negotiated to lower the balance owed either directly by the debtor or through a debt settlement company. The lowered amount is then paid off by the debtor to the creditor in a lump sum. However, in some cases it may take multiple payments to pay off the debt to settle the account.

Debt Settlement is one of the best ways to gain full control of your financial life as it helps you, the debtor, to pay off and settle debts waiving interest, over limit fee and late fee. In some cases, outstanding balance can even be lowered by more than 50 percent.

Why Would a Creditor Be Willing to Forgo a Substantial Portion of Balance Owed Rather than Increasing the amount of Interest and Late Fee Charges on the Debtor?

Creditors know that if the debtor declares bankruptcy they may get nothing. Therefore, in order to protect their financial bottom line they are usually willing to lower and settle the debts than risk getting nothing at all.

Am I a Good Candidate for Debt Settlement?

Debt settlement may be one of the best debt management solutions but it’s certainly not for everyone. It’s a viable option for you if you have a legitimate financial hardship that has led your debts to explode and caused you to fall behind on your payments to your creditors.

We do not welcome any one into our debt settlement program that has bad intentions like defrauding, swindling and deceiving creditors. We only support and represent clients who genuinely need our services.

Why Should I Hire Your Services for Debt Settlement as Opposed to settling it myself?

We have a team of experienced and qualified debt arbitrators who have established good relationships with the creditors and collection agencies. Furthermore, our arbitrators have comprehensive knowledge of Federal & State Consumer Laws. We exercise the Fair Credit Billing Act, the Fair Credit Reporting Act and the Fair Debt Collection Practices Act to negotiate with creditors to lower your outstanding debt significantly, and help you settle your debts so that you can take a fresh start and work towards improving your credit score.

Who Will Hold My Money While Waiting on a Settlement?

Your money will be held in an FDIC insured trust account. The account will be in your name so that you have complete control over the funds. The money collected in your FDIC insured account will only be disbursed once a consensus has been reached with the creditor and you agree with the negotiated offer.

Will the Debt Settlement Program cater to all my debts?

No, not all debts can be settled through negotiations. This process is ideal to get rid of unsecured debts and debts that are not issued by government entities such as credit card debts and medical bills. Our debt consultants can help you choose the debts that you can enroll in the program, and based on your financial situation, devise the best action plan to help you become debt-free in the fastest possible time.

Will The Debt Settlement Program Affect My Taxes?

We don’t provide legal advice on tax. It is advisable to get in touch with a qualified tax advisor for advice on tax consequences and effects of debt settlement. However, we may be able to recommend you a local tax advisor and bankruptcy attorney depending on your state.

How is Bankruptcy Different from Debt Settlement?

Bankruptcy is an option usually considered by debtors when it becomes impossible for them to pay off debts. It is treated as the last resort. Bankruptcy comes with its own share of far reaching and destructive consequences like it stays on your credit report for 10 years, you may have to give up all your luxury possessions, or be denied of employment, insurance, tenancy and state licenses. Once you declare bankruptcy it may be difficult for you to qualify for the method of liquidating assets. Besides, you may not be allowed to discharge alimony, student loans and child support.

Debt settlement is your best alternative to avoid bankruptcy and its consequences. It helps you pay off your debts by lowering the outstanding balance through negotiations with creditors.

Who is a Debt Collector and How Should a Debt Collector Contact a Debtor?

A debt collector is a person who collects debts on the creditor’s behalf. A debt collector may reach out to you either in person or via telephone, mail or fax. 

What Kind of Debt Collection Practices Are Prohibited?

Debt collectors are not allowed to:

  • Advertise debtor debts
  • Harass debtors
  • Use Profanities
  • Repeatedly telephone debtors

In addition to this, they may not use any false statements for debt collection like:

  • Claim that they are government representatives or attorneys
  • Claim that they work for a credit bureau
  • Imply that you, the debtor, have committed a crime

How and Where to Report that a Debt Collector has Violated the Law?

In such a situation, report to the office of your state attorney general and the FTC (Federal Trade Commission). Your state attorney general will help you understand and determine your rights. You also have the right to sue the debt collector in the court of law. If you win, you will be entitled to receive money, in certain jurisdictions, for the damages you suffered.

Who is AFCC?

AFCC is the abbreviation for ‘The American Fair Credit Council’. It is a leading and a trusted association of professionals and experienced consumer credit advocates. The American Fair Credit Council ensures that struggling debtors are fairly treated by debt relief organizations.

What is Your Service Fee?

We don’t charge any upfront fees. It is included in your monthly program payment deposited into your FDIC account. Please note, it is not charged until your enrolled debts are settled and resolved.

If you want more information or want to ask a question, feel free to contact us. Give us a call to talk to our expert debt consultants.