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How long will I need your services?

We recognize that each individual’s situation is unique. The length of time needed to resolve debts varies with each individual. The average client who sticks with our advice can resolve all accounts in about 36 months, depending on the individual’s financial situation.

Should I have you work on all of my debts, or can I pick certain accounts to resolve?

We normally recommend resolving all unsecured debt to help you be as successful as possible. Creditors are generally more willing to negotiate when they see that most of your accounts are delinquent due to your hardship. The decision to resolve all or some of your debt is totally up to you. We are here to help you decide what strategies are best for you. Remember to keep in mind that we are paid on our performance, meaning our fee for each account will be taken only at the time the first payment is funded to a creditor for a negotiated account.

Does CreditAnswers have control of my savings?

No, you are in complete and sole control of your savings. When you agree to settle an account, your payment to a creditor will be funded through your Special Purpose Savings Account based on your authorization.

Does CreditAnswers make monthly payments to my creditors?

No, we do not make any payments to your creditors. Our goal is to resolve your debt for as low an amount as possible. You are responsible for the payments to your Special Purpose Savings Account, which will be used to satisfy negotiated offers, as well as our fees.

Does CreditAnswers contact my creditors?

Yes, we contact your creditors at the appropriate time, using the appropriate negotiation method. Our services begin working for you immediately. We will continue to communicate with your creditors to finalize negotiation discussions as your funds accumulate. It typically takes 6 to 9 months or more before we negotiate and obtain your first offer which allows you to accumulate funds to settle your first debt.

Does CreditAnswers offer credit repair services once their services are complete?

No, we do not offer or provide credit repair services. There are other firms that specialize in assisting consumers in getting their credit back on track, in addition to providing other services that will improve your credit score over time.


How do your debt negotiation services differ from debt consolidation?

Debt consolidation programs combine all of your outstanding debt into one large new loan and sometimes require you to secure the loan with collateral of greater value (such as your home). You will still be required to pay the entire principal amount of your debt plus the interest on the new loan. If you fail to make payments, the lending institution can repossess your collateral. In contrast, we negotiate directly with your creditors to greatly reduce the balance of your debt, allowing you to pay a smaller sum than what you are currently paying. Typically, it takes around 36 months to complete our services, whereas consolidation can stretch out for longer depending on the size and terms of the loans.

What happens if I am unable to save enough funds for you to work on my accounts?

It is very important for you to save as we have planned on. If you are unable to accumulate funds, we will not be able to successfully resolve your accounts. It is imperative you continue to make your monthly savings commitment on time; any delay could negatively impact our ability to assist you.

How will your negotiation services affect my credit?

That depends on what your credit looks like when you first retained our services. In general, if you do not make payments to your creditors according to the terms of your agreement with them, your credit will suffer while you work through and recover from your financial difficulties.

How does the IRS treat debt that is forgiven?

Although you have not retained us to provide tax advice, financial institutions are generally required to provide a form 1099-C in the event a forgiven or settled debt exceeds $600.00, this does not necessarily mean you owe taxes on the forgiven portion. In many 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 that you “owe” more than you “own.” We strongly recommend you consult a licensed tax advisor regarding your particular circumstances. Again, CreditAnswers does not offer or provide tax advice.

Do I continue to accrue interest and late fees while I am using your services?

Yes, late fees and interest typically continue to accumulate, however, we will always attempt to resolve your account with your original balance in mind.

How will my debts be negotiated?

We have established relationships with most of the major creditor networks which allows us the ability to submit your accounts through our partnerships. This lays the groundwork for future settlement opportunities on your accounts, many of which you will receive before you have sufficient funds ready to fund settlement offers. Creditors are willing to offer discounts based on your hardship situation and you may receive fewer collection calls should your account be placed with one of our partners.

What about filing Bankruptcy?

Everyone’s situation is different, but we have assisted many clients to become debt free without having to file bankruptcy. Filing bankruptcy can have long term effects on your credit and can impact your ability to apply for new credit or in some cases, employment. Bankruptcy does not always go away after 7-10 years, as some bankruptcy attorneys may claim. For example, nearly all credit applications ask if you have ever filed bankruptcy in the past. There are also costly court and attorney fees that accompany the filing process. Finally, depending on which chapter of bankruptcy you qualify for, you may still be required to pay back all or some of your debt.

Could a creditor sue me?

Yes, although that is possible and does happen on occasion, it is not typical. However, your creditors will likely continue collection efforts on delinquent accounts. Such collection efforts will include, among other things, phone calls and letters to you, charging off an account, sending accounts to collection agencies or filing a lawsuit. In the event you are sued, please keep in mind you have not retained CreditAnswers to represent you in any court proceedings.


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