1. Is debt settlement the same as debt consolidation and consumer credit counseling?
No. With our Program we negotiate on your behalf to actually reduce the amount you pay to your creditors. Debt consolidation requires you to obtain a new loan in order to pay off your existing debt. If you have too much debt and/or bad credit, it is highly unlikely that you’ll be approved for a consolidation loan.
2. Will all of my debt be eliminated after I’ve finished the Debt Settlement Program?
Yes. If you follow all our procedures, you can expect to be free of all contracted unsecured debt at the conclusion of your program. Of course, you will remain obligated for certain secured debts (i.e., mortgages, auto loans).
3. How long does debt negotiation it take?
The length of time necessary for completion varies from one to four years and depends on you having the funds available to resolve your debt. The time necessary to complete your case will be discussed with you after we review your application.
4. What can I expect from a Debt Negotiation Program?
You can expect a significant reduction in the amount of debt you owe to unsecured creditors. While individual results may vary, we may reduce your outstanding debt to as little as 40% of the balance owed.
5. Do the Program procedures work with every creditor?
No program works 100% for everyone. However, our debt negotiators have an extremely high success rate.
6. Why shouldn’t I just file for Bankruptcy?
You should file for bankruptcy only as a last resort and after all other methods have failed. If you have enough discretionary income to resolve your debt over time, we recommend that you attempt the Program before filing bankruptcy. Resolving your debt through our Program has a more positive impact than bankruptcy on your credit rating in the long run. Remember, bankruptcy stays on your credit profile for up to 10 years.
7. How do I know if my case will be accepted?
You will be advised at the end of the free consultation if your case will be accepted. If you are someone who is in debt and serious about resolving your debt and are currently working, chances are we can assist you.
8. What is a 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 or an automobile. If you fall behind on payments on this type of debt, the lender can repossess the property in order to recover their loan. It is important to remember that you may remain liable for any deficiency balance owed after the property is repossessed and sold. Certain exceptions may apply and will depend on the exact nature of the security interest. The laws regarding home mortgages vary from state to state and the lenders rights generally depend on the terms of the mortgage and whether any other lenders have an interest in the real property. In these situations it is important to seek competent legal advice to protect your interests.
9. What is an Unsecured Debt?
An Unsecured Debt generally arises out of a contract you enter into with a creditor, which enables you to obtain goods or services on credit in exchange for your promise to pay back that creditor. The most common types of unsecured debt are: credit cards, medical bills and personal loans. If you fall behind on this type of debt, the only recourse the lender has is legal action.
10. When does a Secured Debt become an Unsecured Debt?
A secured debt may become an unsecured debt in situations where the property securing the loan has already been repossessed and sold by the creditor. If the sale of the property does not cover the contractual obligation, the consumer owes a deficiency balance. This deficiency balance then becomes an unsecured debt. Certain exceptions may apply and will depend on the exact nature of the security interest.
11. Do I have to include all of my debts or can I select which ones I want you to resolve?
In the Program you can select which accounts you would like us to resolve. It may be recommended that you include all or most of your unsecured debt and this will be discussed during your free initial consultation.
12. Will I keep getting calls from creditors?
You may receive some calls. After you are enrolled in the program, you can direct your creditors to continue all communication with our office. We also will send out a notification to your creditors that you are now represented by legal counsel and that all future communication should be handled directly through our office.
13. How will the Program affect my credit?
While some clients will experience an adverse affect on their credit if their debts are current with no history of late payments, our Program will ultimately improve your debt-to-income and debt-to-limit ratios and may therefore improve that specific portion of your credit score. Since your outstanding debt is resolved by way of settlement, future creditors will see that you have made a concerted effort to resolve your debt instead of filing bankruptcy. In the long term, your credit report should be much higher.