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Debt Settlement Questions

 

During the debt settlement process, undoubtedly questions will arise. When this happens, please do not hesitate to call your debt settlement coach. We are here to help you reach your goal of financial freedom and are available to answer any questions that you have.

How long does it take to complete the CreditAnswers program?

We recognize that each individual's situation is unique, and try to take every detail into consideration when planning a personalized credit settlement program that works in conjunction with your budget. The length of time to complete the program varies with each individual.

How does debt settlement differ from debt consolidation?

The names sound the same, but there is a world of difference. Debt settlement may decrease your debt balance. Your results may vary based on our negotiations and agreements with the many creditors with which our debt negotiation experts have established relationships. Whereas debt consolidation programs combine all your outstanding debt into one lump sum, and secure your total debt amount with an asset of great value such as your home. Debt consolidation only buys you more time, drawing out the payback process and offering risky consequences. Debt settlement generally takes time to complete and no outcome is guaranteed.

What kind of team do I have working for me at CreditAnswers to settle my debt?

We build relationships with our clients based on trust and support. We know the difficulties and stress that financial problems entail. Our dedicated team of knowledgeable credit specialists has experience dealing with personal debt and will provide you with facts that will help you make informed decisions.

Do I have to combine all my debts, or can I pick certain debts to settle?

The decision of settling some or all of your debts is totally up to you. Our credit specialists will help you decide what strategies are best for you.

What's so bad about filing bankruptcy?

Bankruptcy may seem quick and simple, however many people file for bankruptcy each year failing to realize they are forced to deal with the harsh effects that will plague them for the rest of their lives. One must first be aware that bankruptcy does not go away after 7-10 years, as some bankruptcy attorneys may claim. The reality is many credit applications ask if you have ever filed bankruptcy, and to answer falsely may be considered a federal offense. Also, costly court and lawyer fees accompany the process of filing for bankruptcy. And with changes in bankruptcy laws, many consumers will not be able to eliminate their debt simply by filing for Chapter 7.

Consumers may now be required to file Chapter 13, which requires you to pay back a portion of your debt under the supervision of the court. This process may last for years. Bankruptcy should be considered one of the last remaining options in solving financial problems but you should always consult with an attorney regarding such matters.

How does the IRS treat debt that is forgiven?

Financial institutions are generally required to provide a Form 1099-C in the event that a forgiven debt amount exceeds $600.00. Please understand that if you receive a Form 1099-C showing income in the form of canceled debt, this does not necessarily mean that you owe taxes on the forgiven portion of the debt. In most cases, clients can legally and ethically exclude forgiven debt from their income through the "insolvency exclusion" provided by the IRS code. This exclusion means that your liabilities exceed the fair market value of your assets, or in other words, you "owe" more than you "own". We recommend that you consult your tax advisor regarding your particular circumstance. They will also be able to assist you on filling out Form 982 that excludes you from the particular debt.

Does CreditAnswers make monthly payments to your creditors for you?

No, you are responsible for all payments to creditors, including collection settlement payments. CreditAnswers only collects its fees on a monthly basis and you are responsible for any payments to creditors and for saving funds to settle your debt.

Is it wrong for me to avoid creditors calls or use different types of call screening devices?

It is your right to accept or not accept unwanted calls. We leave the decision up to you.

How does debt settlement affect my credit?

That depends on what your credit looks like when you enrolled in our debt settlement program. But in general, if you do not make payments and do not pay your creditors according to the terms of your credit card agreement, your credit will suffer.

What happens if I am unable to save funds?

This is a debt settlement program and if you are unable to accumulate funds then we will not be able to settle your accounts. If something happens and you are unable to make a full or partial payment, call your settlement coach about getting some short-term relief.

Does CreditAnswers have control of my savings?

No, CreditAnswers does not have any control over your savings and never acts as an intermediary when it comes to your funds. The only money CreditAnswers ever receives from you is our service fees.

Can CreditAnswers stop collection efforts including lawsuits brought by creditors?

No, but we do have strategies on helping you manage the collection efforts and can direct you to an attorney to answer any suits that may be filed.

Do late fees and interest charges stop while I am in the program?

No, the interest and fees continue to accumulate, but CreditAnswers will negotiate your settlement with your original balance in mind.

Can I be sued by my creditors?

Yes, if you fail to make payment to your creditors, they may take legal action against you.

Does CreditAnswers contact my creditors?

At the appropriate time and once you have accumulated funds to settle an account, CreditAnswers will contact your creditors to begin debt settlement discussions.

 

In order for us to be successful, we realize you have to be successful. We've found the following Client Success Principles will serve you well in our program:

Be Informed

To be a successful client, you need to understand all aspects of your debt settlement program and make sure the program is right for you.

Spend Less Than You Make

No debt settlement program will work unless you are able to save money – that means you have to spend less than you make. We can't settle your debt unless you accumulate funds.

Have Patience And Perseverance

It takes time to settle your debt, you have to be focused on the long term relief you will get by staying focused on the end goal – financial freedom. It won't be easy – so be patient and persevere.