Frequently Asked Questions About Debt Settlement

Q. Who is qualified for our program?
Q. Who is NOT qualified for our program?
Q. How do you apply?
Q. How will you settle my debts?
Q. Is bankruptcy a better option for me?
Q. Does Debt Settlement have a negative impact on my credit?
Q. Can I still use my credit cards?
Q. Will interest and fees continue to accumulate?
Q. What will I pay for your services?
Q. Do you guarantee that you will settle all of my debts?
Q. Can I be sued?
Q. Can you stop my creditors from calling ?
Q. Do you repair my credit?
Q. Can creditors garnish my wages?
Q. What are the tax consequences?
Q. Can't I negotiate my debts with my creditors on my own ?

Q. Who is qualified for our program?
A. A debt settlement program is only for people facing financial HARDSHIP. This means people who are late on paying their debts, have little or no ability to pay their debts in the future and are facing a possible bankruptcy.

Q. Who is NOT qualified for a debt settlement program?
A. This program is not designed to negotiate debts for people who have reasonable means to pay off their debts. If you have the ability to pay your debts in the normal fashion, then you should honor your debts and do so. This program is NOT for people who have high credit ratings and can meet their monthly debt obligations.

Q. How do you apply?
A. Complete the form online. A debt consultant will review your information and call you to review your situation. After a debt consultant has reviewed your financial situation and hardship they will determine if you are qualified for our program.

Q. How will you settle my debts?
A. You will be asked to put aside and save a set amount of settlement funds on a monthly basis. This amount will be determined in your initial analysis based on total amount of debt and will be in line with your income and expense budget. Each person's situation is different and the negotiation process will begin at different times depending on the amount of your debt and your ability to save funds. . Once the creditor agrees to a settlement amount, we will present this offer to you. If you approve of the settlement, we will instruct the creditor to fax over the 'settlement offer' in writing and notify you, so that you can release funds to the creditor.

Q. Is bankruptcy a better option for me?
A. Anyone considering our program should also contact a bankruptcy attorney to determine if their situation warrants filing for bankruptcy. Using the Debt Settlement process does not guarantee that you will not have to file for bankruptcy in the future.

Q. Does Debt Settlement have a negative impact on my credit?
A. YES. Your credit score will decline due to entering this program. How much it will decline depends on your original circumstances. Most of the accounts you place into negotiation are likely to "charge off", which will reflect negatively on your credit. When a settlement is complete the creditor should notify the credit bureaus that the account has been settled.

Q. Can I still use my credit cards?
A. NO. All credit cards in the program will not be active and you will not have credit privileges. Any cards you DO NOT put into the program should not be used. This program is for you to get out of debt.

Q. Will interest and fees continue to accumulate?
A Yes, Interest and Fees will continue to accumulate for a period of time.

Q. What will I pay for your services ?
A. You will pay a fee which is calculated based on the total amount of debt enrolled. All costs and fees are always fully disclosed and you are required to sign for approval before you commit to our program.

Q. Do you guarantee that you settle all of my debts?
A. NO. There is no guarantee that your creditors will negotiate with us or that your debts will be reduced.

Q. Can I be sued?
A. YES. Your creditors certainly have the right to sue to recover their money.

Q. Can you stop my creditors from calling?
A. NO. Your creditors have every right to try and contact you in order to collect a debt. If your account is in collections; collections agencies have to adhere to the FDCPA Guidelines. If you would like to learn more please read Fair Collection Practices Act. This defines when and how a creditor may contact you.

Q. Do you repair my credit?
A. NO. Companies cannot remove legitimate negative items from your credit report. Negative items will remain on your credit report according to the conditions imposed by the credit reporting agencies. The goal of a Debt Settlement program is to settle your delinquent accounts. When a delinquent account is settled this is reflected on your credit report

Q. Can creditors garnish my wages?
A. YES. The creditor first has to sue you, successfully obtain a judgment, and then file for a garnishment action

Q. What are the tax consequences?
A. Your creditors will report cancelled/settled debts exceeding $600 to the IRS and you are required 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. You need to consult your own tax advisor for advice specific to your situation.

Q. Can't I negotiate my debts with my creditors on my own ?
A. YES. You can negotiate your debts with your creditors on your own. As a matter of fact if you successfully negotiate a debt it may cost you less in the long run to use this approach than to use our services.