1. What is Debt Consolidation?
This type of program is designed to help people who are committed to becoming free of unsecured debt by lowering interest rates, making one payment, and shortening the time frame as much as possible. Most people who qualify for a consolidation program are able to make their minimum monthly payments and are current or behind but no more than a month or two.
They realize that paying minimums with their current interest rates and finance charges will take years and years to become debt free. They will be paying back close to three times what their current debt is. Sometimes people are simply over-extended or are tired of making payments to lots of different creditors each month.
2. What are the benefits of consolidation?
Debt Consolidation saves you thousands of dollars in interest and late charges meanwhile drastically reducing your pay off time.
Debt Consolidation makes regular monthly payments for you to your creditors.
Debt Consolidation can re-age your accounts with most creditors (bringing you current).
You make only ONE monthly payment.
You have expert financial consultants working for you, not your creditors!
3. How does the program work?
The consumer credit counseling company is a non-profit foundation that negotiates with each of your creditors to obtain the lowest interest rates and monthly obligation needed to satisfy all of your accounts.
You are responsible to make one payment each month. This payment is then portioned out to your creditors.
4. How long will it take to pay off my debts?
This depends on your mix of debts and creditors, as well as, your monthly payment. There is no pre-payment penalty. Any additional funds you send will be applied directly to your principle and will result in saving you even more money. Most people complete this program in two to five years or LESS.
The non profit foundation uses a system to accelerate your debt free goal. It is called "roll up". Your payment to each creditor is determined and re-portioned as one creditor is satisfied and then another, and so on. This "roll-up" process will create the shortest time possible to become debt free.
In addition, whenever applicable, Credit Care Solutions will arrange an accelerator/buffer. This will shorten the entire pay-back time frame.
Credit Care Solutions will also assure that the payment structure follows the “creditor guidelines” to prevent putting you in an "upside down" situation with your creditors as some other programs create.
5. How do I know if this program can benefit me?
Every prospective client is offered a free, no-obligation consultation with a senior consultant. During the consultation, your financial situation is discussed in detail, and benefits of the program are explained.
Your debt consultant will work with you to estimate your monthly payment, based on your situation. Although every situation is unique, this program can be tailored to fit most people's needs.
6. How do I qualify?
If you and your senior debt consultant feel that this kind of program is right for you, and you are able to make a monthly payment towards your debts we can qualify you for the consolidation program.
7. How do I enroll?
Your program will begin as soon as you tell us to. It's as simple as that. A registration/enrollment packet will be sent to you. Once you fill it out, sign, and return the packet, a letter will be sent to each of your creditors to begin negotiating your interest rates.
You will receive a monthly spreadsheet showing the payments made to each creditor. You will also continue to receive statements from your creditors monthly.
8. What type of debts can I include in consolidation?
Almost any unsecured debt can be included: credit cards, personal loans, medical bills, other unsecured debts. Unsecured debts are those debts not backed or underwritten by an asset like a home or car or insured by the government such as student loans, IRS, etc.
9. Do I have to include all of my debts in consolidation?
No. You have the ability to tailor the consolidation that fits your needs best. We do not mandate which debts you include. However, it is in your best interest to have all your unsecured debt consolidated and managed monthly.
10. Why can't I contact my creditors myself and do this?
You certainly can try. Most of the time creditors are not willing to work with individuals to lower interest rates. Plus, if you don't have the necessary negotiation skills and experience, you will never know if the creditor is giving you the best terms available. Sometimes they will lower your interest or defer your payments for six months. The problem is that it usually is for six to nine months and then it is “retroactive” leaving you with more unpaid debt and fees.
The foundation works with all the creditors on behalf of thousands of clients, therefore, creditors are willing to reduce and/or eliminate both interests, late and/or over limit penalties.
The professional staff is trained in the "consolidation language". They know the special terms that are available, as well as, what solutions have been successful for others in similar situations.
11. Can debt consolidation help improve my credit?
Yes! The foundation we represent is not required to report our clients to any credit reporting agency and never do. By reducing the amount of debt you owe, your debt-to-income ratio improves which helps improve your credit.
Your creditors may choose to make a comment on your credit report, indicating that you are working with a counseling agency or are involved in a payment plan. This by some if viewed as a big positive.
Also, if you are behind or over limit in your debts, the foundation will re-age your accounts (show you current) with most of your creditors, after four consecutive months in the program.
Creditors prefer to collect debts at reduced rates rather than forego them completely to a customer declaring bankruptcy or being sold to a collection agency.
In addition, we find consumers prefer to protect their valuable credit for the future and manage their monthly bills more effectively.
Once financial problems have begun, using a debt management service demonstrates responsible action taken by you to avoid further financial difficulties. Creditors generally read this as a plus in evaluating your credit worthiness.
12. Should I consider a consolidation loan?
You cannot borrow your way out of debt! A consolidation loan will not reduce the amount you owe. It will only place your assets at risk or extend your debt farther into the future and place you deeper in debt. This only extends your difficulties and does not solve them.
13. How do I get started?
There are several ways to get on track to financial freedom:
Simply call us toll-free at 1-888-456-3328 and we will take the necessary information over the phone (please have your most recent statements handy) or E-mail customerservice@creditcare4u.com
We are here to help!
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1. What is Debt Negotiation?
Totally different from Debt Consolidation. This program is faster, more drastic, offers lower payments and is definitely effective.
Negotiation focuses on balances not interest rates and it usually reduces what you owe by 40 to 60%.
Unlike Debt Consolidation, negotiation does not make regular payments to your creditors, therefore credit cleanup is provided as a “piggyback” to the program.
This program is designed to get people out of debt with the least amount of dollars, lowest payments and fastest time frames.
The program can especially benefit clients who are already behind on their payments or who clearly know that the creditor's regular monthly payments are no longer feasible for their current situation.
This program is not for everyone. It is not intended to be for everyone. It is an excellent solution for certain clients. Talk to your consultant to see if this is the “best” program for you.
2. How does the program work?
Once a realistic budget and monthly payment is determined by your consultant, these payments are drafted and placed in an escrow account for you. As the money begins to accumulate the negotiators will begin offering settlements with each creditor. The first settlement could be as long as six months depending on your ability to contribute funds. Since this will appear late with your creditors the negotiators will be working “simultaneously” with credit cleanup.
Most people can finish the program and be completely debt free in 24 to 36 months.
3. Who is eligible to participate in your program?
The majority of applicants are accepted into the program. Your consultant will review your financial situation and make a preliminary determination as to your eligibility and determine if this is your best solution. Your credit history, good or bad, is not a factor for eligibility.
Further, you must live within the United States and have US debts.
4. What is the cost of your program?
The fees are arranged in a way to be affordable with little out of pocket expense, this includes a set up fee and two enrollment fees. The negotiators also earn 35% of what they save you, giving them incentive to accomplish the best settlements possible. This percentage is included , not on top of, your monthly payment. Upon completing the program, your credit will be restored with no additional fees for the credit clean up services throughout the program.
5. Which of my debts can I include in your program?
Negotiators work with all types of unsecured debt, such as credit cards, medical bills, old utility bills, etc. They do not work with secured debt such as mortgages, car loans, tax bills or government backed student loans.
6. Can I leave some of my unsecured debt out of your program?
Yes. You have the option of leaving one credit card and/or one gas card out of the program. The credit card, however, must be used sparingly and must be paid off in full each month.
7. If I have a co-applicant on a card, can I go on the program without their permission?
Yes. However, you must provide the written agreement of all account holders for each account included in the program. Should you have an account with an uncooperative co-applicant, you may leave this account out of the program.
8. What if one of my creditors is drafting their payment directly out of my account?
We can recommend closing your current checking account and opening a new one. Stopping payment on the draft is insufficient, because if you put a stop payment on a draft, the creditor can just run the draft for a different amount. For example, if you have agreed to have $100 taken out of your account each month, and you put a stop payment on the $100 draft, your creditor can just run the draft again for $99 or $101. It will then go through, since your stop payment was for $100.
9. How will your program affect my credit?
Your credit is affected while you are on the program because monthly payments to your creditors are not being made. This is in part how negotiation achieves the best deal for you. However, as they negotiate with each of your individual creditors, as a part of each settlement, the creditor is required to report to all three credit bureaus that your account has been paid and settled in full. It is also important to keep in mind that as your debts are negotiated away, your debt to income ratio will dramatically improve. In addition, the "credit cleanup service" simultaneously works to restore your credit by the end of the program.
10. Is bankruptcy an option?
Bankruptcy is appropriate in certain situations, but it is not the "easy quick fix" that it is often advertised. The emotional side effects from bankruptcy will last a lifetime. In general, someone who qualifies for a negotiation program is far from this desperate of an outcome.
Your negotiator will explain to your creditors that you are honorably trying to pay your debts and they will receive an equitable settlement of what you owe them.
Smaller monthly payments and lower balances usually help people to honorably eliminate their debts through negotiations. This kind of program allows you to feel proud of the choice you have made. You have not walked away from your obligations. This is dramatically better than bankruptcy, wouldn't you agree?
11. If I have irregular income, can you help me?
Yes. Talk with your consultant to put together a payment plan that works within your budget.
12. Can I request to have more money drafted then my scheduled monthly payment?
Yes you can. The sooner you accumulate settlement monies in your account, the sooner your negotiator can make offers to your creditors and help you put your debts behind you.
13. Where is my money held as it accumulates prior to settlement?
Your money is held under your name in an escrow account building for settlements.
14. When does the negotiation process start?
Once your enrollment fees have been paid, funds will start to accumulate in your escrow account. The order in which your accounts are negotiated depends on your set of creditors. When there is a sufficient amount available, negotiators will begin making offers on certain accounts based on their knowledge of which creditors are most urgent, and which will accept the best offers. They may allow smaller accounts to wait, even though there might be plenty of money to settle them because they need to accumulate enough funds to settle a larger account with a more urgent creditor.
15. Will I be notified of pending settlements?
Yes. When your negotiator receives an acceptance to settle from the creditor you will be notified immediately. These offers usually have a very short window of opportunity of 2 to 5 days. Your negotiator will be looking for a yes or no from you.
16. What part do I play in the ongoing process?
You play a vital role in the success of your program:
It is important that you be available to discuss and approve settlements. It is important that you return phone calls. It is important that you be pro-active with your negotiator and stay out of the way of the creditor.
It is crucial that you use the forms: “creditor call script” and “creditor call record” provided with enrollment. It is important not to engage in conversation with your creditors.
And lastly, forward any written communication from your creditors to your negotiator.
17. Should I tell my creditors that money is being put away for negotiation?
No. You should not be discussing your account with your creditors. You have hired a company to do that for you. Both you and the negotiator can't be communicating with the creditor.
It is crucial that you follow and use the “creditor call script” and “creditor call record” forms as provided upon enrollment. The more you deviate from the “creditor call script”, the harder it is for the negotiator to settle your creditor accounts.
18. What do I do when creditors call me about late payments?
It is absolutely crucial that you follow and use the “creditor call script” and “creditor call record” forms as provided upon enrollment. As the information from the “creditor call record” develops, the negotiating firm will take action to enforce your rights. Usually, harassing calls will decline or cease after the creditor receives notice that they are working on your behalf.
19. Will my creditors take legal action against me?
Creditors do have the right to pursue a debtor in a court of law to attempt to collect a debt. However, this is very rare and is usually only a last resort after much effort to collect without response or satisfaction. Taking a client to court is a very costly and time-consuming activity, which most creditors would prefer to avoid if given an alternative. The main reason that a creditor takes action is lack of communication. The negotiators are in constant communication with the creditors, letting them know what your situation is and answering their questions.
If a creditor does take legal action, the negotiators have the experience to know what steps to take to slow down or stop the proceedings. Negotiators work with the creditor to find a solution that will satisfy everyone before further action is taken. Once a settlement is reached, there is no further action that the creditors can take. The settlement is final and in writing. You will receive a letter from the creditor stating that they have settled with you in full and no further monies are owed. They will then send a letter to the credit reporting agencies stating that the debt was settled and that you have a zero balance with that creditor.
20. Can I get legal advice from the negotiators?
No, they do not give legal advice. They are not attorneys. If you think you need advice on a legal matter, we encourage you to talk with an attorney. The negotiators are associated with and can refer you to qualified attorneys in your state.
21. Why couldn't I just negotiate with my creditors without your services?
You absolutely can. However, creditors know that their clients will give in to their pressure and threats, so in most cases, they will not settle for less than the entire balance when dealing directly with the borrower. Or if you are lucky they will give you a great reduction in your balance if you pay it “all” immediately. This just doesn't work for most people.
The negotiating firm on the other hand, has long standing relationships with hundreds of creditors. They represent millions of dollars of debt, which sets the stage for lower settlements with creditors. In addition, they have an intimate working knowledge of the law and consumer rights in this area.
22. How do I contact you if I have any questions about my account?
You can contact Customer Services Department by phone, email, or fax with any specific questions you may have about your account. The contact information will be in the enrollment packet you receive upon submitting your application. Also, your consultant will be happy to assist you with general questions about your situation.
If you found our website through a search and do not have a consultant, please send us an email including your name, telephone number and e-mail address to: customerservice@creditcare4u.com .
For immediate assistance call 1-888-456-3328
A Senior Debt Consultant will contact you promptly.
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