What is Debt Settlement?
Simply put, our attorneys negotiate with your creditors to settle your debt for less than you owe. This could mean a 50%-75% reduction in your debt owed! Debt settlement is viable option for those who have credit card debt and a financial hardship that makes it difficult to make the payments.
Do you want the TRUTH about Debt Settlement?
Ask yourself, “If I don’t do something, will I leave myself unprotected and at the mercy of the creditors I owe? Do I need help to make sure this doesn’t happen?”
If you answered ‘Yes’, you may need Debt settlement, BUT it is not for everyone. The only debt settlement program you should consider should be with a law firm. WHY? This program is not for taking risk but for avoiding the risk of wage garnishments, bank levies, and even liens which can result in foreclosure of your property. Only a law firm can help you with these kinds of legal financial issues. We have years of experience creating plans to get our clients successfully out of debt. Our clients are either trying to avoid bankruptcy, or don’t qualify for bankruptcy, and this is the best option to help them out of their financial situation. If you are still able to make payments, and you don’t see yourself having trouble in the next 6-12 months, you should continue to pay. On the contrary, if now or in the future, you see your money being depleted and you can see a vanishing point of your available funds to pay, then this is a proactive step to help protect your finances, family, and avoidance of potential bankruptcy.
Typical client cases we accept are in one of the three following situations:
1. They have fallen behind with their payments and can’t catch up.
2. They think they might fall behind with their payments in the next 6-12m if they do not find a solution
3. They are only able to make the minimum payments and because their interest rates are so high, or minimum payments have increased, and they’re not making any progress on paying off their debt.
How can our Attorney Debt Settlement help?
With our law firm, you can get the 5 benefits listed below.
- Avoid potential Bankruptcy: With debt settlements, you can reduce your debt burden and pay off bills comfortably. We can negotiate with the creditors or collection agency (CA) and settle your debts for less than you owe. Thus, you do not need to file for bankruptcy. In bankruptcy, there are chances of losing your home or cars wherein your assets are sold off to pay your creditors.
- Single payment: Instead of paying multiple bills each month, you’ll get to make a single monthly payment to the FDIC trust account set up for you by our company. The monthly payments are accumulated in the trust account in order to be paid to your creditors/CA after negotiation. This will help you avoid the stress of paying debts at different rates and having to deal with several creditors at a time. We handle it all for you.
- Avoid unfair collection practices: We are attorneys; we can prevent or stop unfair collection practices and harassment by debt collectors when we negotiate a settlement.
- Eliminate extra charges: We can try and eliminate late payment fees, if any. Any over-the-limit fees on credit cards can also be minimized or eliminated by way of our settlement program.
- Avoid lawsuit & other legal actions: Creditors or the CA can file a lawsuit, get a judgment order, and even garnish your wages, or place a lien on your property. You may be able to avoid such legal actions if you are in our settlement program.
How does our Attorney Debt Settlement programs work?
Our Law Firm offers a debt settlement program wherein we negotiate with your creditors/CA in order to settle the debt for less than what you owe. We have some advantages as your attorney; we can dramatically reduce or even stop collection calls, debt settlement companies cannot. We can give you legal advice, debt settlement companies legally cannot. Past client typical results include: reducing your current monthly payment by 20-40% immediately, giving you the payment relief you need while settling your debt. In order to get the leverage you need to negotiate your creditors, you should stop paying your creditors to motivate them to settle with you. To insure our clients money is safe during this period, monthly payments are accumulated in an FDIC insured account to which only you have access. Once enough funds are accumulated, we complete negotiations with your creditors/CA and attempt to settle for 40-90% off of what you owe!
What type of debt can be settled?
Types of unsecured debt include:
- Credit cards
- Medical bills
- Gas/department store cards
- Personal loans/lines of credit
- Business loans/lines of credit
- Unsecured deficiency balances (typically coming from car repossessions or home foreclosures)
Tax debts, alimony, child support, mortgages, car loans, and federally insured student loans are excluded from a settlement program.
How long does it take to settle my debts?
The period of completion depends upon your total debt amount and how quickly you want to be out of debt. We have clients who are very aggressive and have the money available to settle in as soon as 6 months. Others need payment relief immediately and opt for 36-46 month programs to get them out of debt.
Can Creditors sue after my settlements?
NO, not in our program. Once we negotiate debt settlements with your creditors/CAs, they may not come after you for the balance. This is due to the letters we receive in advance of paying the creditor/CA. These letters state the settlement paid represents the payoff of the debt and no further action can be made against our clients. We will never send your money to a creditor/CA without this letter. Believe it or not, not all debt settlement companies do this; they could leave you exposed to additional cost even after the program ends. We know what we are doing and how to protect our clients even after they complete our program.
Will taxes be owed on my forgiven debt?
Once you enroll in debt settlement, creditors can forgive a percentage of what you owe. This forgiven debt, known as cancellation-of-debt (COD) income, is taxable as per IRS guidelines. However, you may or may not be subject to COD income tax. There may be ways to offset this, talk to your tax professional or call us and we can refer you to a trusted CPA.
Does debt settlement affect my credit score?
We understand your concern for your credit history. It is true that entering into a debt settlement program will temporarily have a negative impact on your credit score. Of course, not being able to pay your debt in the future will have the same effect, and that is probably why you are looking into debt settlement now. Our debt settlement program is designed to let you take control of your credit and your debt on your terms.
- First, credit is needed when you need to acquire more debt. If you are looking into debt settlement, this is probably not your situation. Even if you are current, you may not be able to obtain more debt due to several factors or a combination of several factors such as: your total debts owed, the proportion of your balances to your credit limits, or the current reluctance of creditors to lend money or extend lines of credit.
- Second, we can use your credit as a negotiating tool to get better settlements for you. Think about it this way, what motivation does a creditor have to negotiate if you are making payments? NONE, why would they reduce your balance if you continue to pay the creditors light bill from all the interest you are being charged?
To summarize, the effect on your credit will be temporarily negative. However, in the long term, reducing the balances on your debt, increasing your cash flow, and increasing your debt-to-income ratios, will have a positive effect on your credit score.
We will always recommend to our clients to work to maintain as good a credit rating as possible. If you are able to continue making payments in full to your creditors this would be a prudent course of action. If you are not able to continue making these payments, debt settlement may be your best option.
What is the next step?
Contact us and we will do a full evaluation of your specific situation to make sure you a are a candidate who will have the best opportunity to successfully complete debt settlement. Click here to contact us now or call us at 877-343-3289 for immediate help.
Two Other Options- Debt Consolidation and Credit Counseling
It is important to know your options when you begin to take steps in managing your debt. We are here to show you all your options not just the services we provide. We don’t believe the services below accomplish the needs of our accepted clients, therefore we don’t offer these services.
Debt consolidation involves taking out another third party loan and transferring all qualifying balances to this loan. You then pay that lender one payment a month and you will be required to pay back all of the debt plus interest. Interest rates and programs may vary. The advantage of this program is that you get to keep your existing credit card accounts. However, you are also entering into another loan with a third party, with more interest and fees, which may adversely affect your credit score.
Credit counseling involves a third party but no additional loans. During credit counseling, a third party will negotiate lower interest rates through your current lenders. You agree to the closing of your participating credit accounts and your debts will be compiled into one monthly payment which includes a credit counseling fee. Upfront start-up fees may also apply. Typically, you will be required to pay back 100% of the debt. These programs can take 7yrs or more to complete.