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FAQ
1. What is the difference between debt reduction and debt consolidation?
Debt reduction is the process of lowering your principal balance and interest rates to less than you currently owe. This process is usually complete and your entire debt is paid off in a 12-36 month period. For example, if your debt amount is $30,000, we can generally get it reduced on average to $15,000. This figure includes the amount you owe and interest.
Debt Consolidation involves qualifying for a new a loan from a bank to consolidate all of your outstanding unsecured debts. The typical interest rate associated with Debt Consolidation is 12%. For example, if your debt amount is $30,000, you will pay the entire $30,000 principal balance back plus 12% interest. The usual payoff time frame is 5-7 years with a debt consolidation loan and your combined payment to eliminate the debt would be close to $40,040.01.
2. What is a settlement?
A settlement is an agreement made by our attorneys or negotiators on your behalf with your banks or credit card companies stating that they are willing to take a lesser amount of money than you currently owe them and consider it a full payment with a zero balance reporting on your account.
3. Why would my creditors be willing to accept less money that what I actually owe them?
Because your debt is unsecured they essentially are left with little or no choice. They are left with the option of you filing for Bankruptcy and them receiving nothing or they can take a loss and at least recoup a portion of what they lent to you.
Our attorneys and negotiators have a personal history of dealing with major creditors and lenders that have come to realize that clients who are enrolled into our debt reduction program are more likely to fulfill the settlement amount than clients whom are not enrolled into our program.
4. Will the creditors continue to call me?
No company can stop all of the creditor calls, so if a company claims they can, be very careful! Your creditors do have a legal right to call and try to collect the debt from you. However, there are several things we do to combat and eliminate roughly 95% of these phone calls. We will supply you with a creditor call script so if a creditor does call you can be assured of what you need to say to them before offering them our phone number. We will also send out cease and desist letters to your creditors so they are informed that you have enrolled into our program and to contact us directly to work out a new payment arrangement.
5. Do I have to enroll all of my credit card accounts into the debt reduction program?
No, it is wise for you to keep at least one credit card out of the program to use for emergency purposes. You would want to keep the credit card with the lowest balance and interest rate out of the program.
6. Will my credit card accounts be closed if I enroll them into a debt reduction program?
Yes, the accounts that you choose to enroll into the debt negotiation program will be closed. It is impossible for us to obtain settlements from your creditors if you are still using the accounts and making timely payments.
7. How long does it take to enroll into your debt reduction program?
Once you have discussed your financial situation with our consultants you can immediately enroll into the debt reduction program that best fits your needs and start benefiting from lower monthly payments.
8. Can I negotiate my debts with the creditors myself?
Sure, some people have attempted and found success with it, while most others would rather leave it up to an attorney or negotiator. Remember, you are going up against a professional collector who makes a living off of collecting debts and may not take an individual as seriously as an attorney or professional negotiator who is officially representing the client.
9. What types of debts qualify for your debt reduction program?
We work with most unsecured debts, such as credit cards, gas cards, department store cards, personal loans, etc. |
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