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1. What Debt Free Living is not? |
Debt Free Living is not a lending institution. We do not loan or arrange for the lending of money.
Your debt is reduced, we don't invoke new debt to pay off old debt. Debt Free Living is not a
bankruptcy service.
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2. How does your debt reduction program work? |
A
professional financial consultant from our staff will review
the preliminary information you will provide to us through our
website
("Click For Free Quote"
, if you haven't already done so).
The consultant will then contact you and discuss your specific situation.
You
will discuss your income and expenses with our staff counselor
and we will suggest the most comfortable payment plan based
on your budget.
We
will instantly tell you what your monthly payment will be and
how long it will take for you to become "debt free after
all". It usually takes 3 - 36 months.
We
then use your monthly payments to satisfy the negotiated creditor
settlements and our fees.
We
will send you written confirmation of each creditor settlement
we make on your behalf.
We
notify your creditors in writing that you are working with our
organization to resolve your debts. The creditors are told that
all future communications should be directed to our office.
This helps stop creditor harassment and get you out of debt
as quickly as possible, while saving you as much money as possible.
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| 3. How
long does it take to enter the debt reduction program? If so,
how will it be affected? |
Once
you have discussed your needs with our consultants, assuming your
debts qualify, you can immediately enroll in the program.
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| 4. What
is the difference between debt reduction and debt consolidation? |
Debt
consolidation companies (also known as credit counselors) mainly
get some reduction in INTEREST ONLY. These companies generally
work for and on behalf of the credit card companies. It can
take 5 - 10 years to pay off your debts, and you are paying
off the full amount that you owe your creditors.
We
work for you and our debt reduction program gets your actual
debt balances reduced by 30% to 80% on average, and you can
get out of debt in 3 - 36 months depending on your budget.
For example, if your debt amount is $20,000, we will get it
reduced on average to $8,000. This figure includes the amount
you owe and the interest.
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| 5. What is a settlement? |
This
is an agreement made by your financial consultant with EACH
of your creditors stating that they will accept a lesser amount
of money than you owe them as full payment, and stating that
there is a "zero" balance on your account.
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| 6. Why
would the credit card companies be willing to settle for less money to pay off the debt? |
They
realize it will benefit them to settle the account rather than
lose the whole amount if you declare bankruptcy (as this
is an unsecured debt).
Also,
since our staff has a history of dealing with major lenders,
creditors have come to realize that we fulfill negotiated settlements
with the time frame agreed upon in the settlement agreement.
And this is VERY important to them.
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| 7. How
will the debt reduction program affect my credit report? If so, will it be affected? |
Your credit report is going to show a history of late payments until a settlement is paid. For instance,
your smallest creditor should be settled in about six months. That’s about how long you’ll
show a history of late payments. As we negotiate and settle each of your debts, your credit report is
going to show that they have been settled and have a balance of zero. Whenever you apply for credit after
completing our program, creditors are going to look at your credit report to see if you took care of your
debts. When you complete our program, you will be able to answer "Yes, I took care of my debts."
Remember we want to pay your creditors just as badly as you do. Anything you do to get out of debt; short
of paying to full amount upfront, will have a negative affect on your credit.
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8. Will collectors continue to call me? |
We have a letter that will be sent to each of your creditors instructing them to stop calling you as
part of their debt collection efforts. Instead the creditors are informed that you have enrolled into
our program and that you intend to make a settlement offer you have accumulated a reasonable amount of
money to offer. NO COMPANY CAN STOP ALL CALLS. But we can reduce the number of call and make it easier
to answer the phone.
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9. How long before a debt is settled? |
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That’s really up to you. We’ve got you set up to pay off all your debts within months but
chances are that after you get back on your feet and you’ll be able to add a little extra here
and there. The more money that you make available the faster we can ask or offer settlements. |
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| 10. Can I negotiate my debts
with the creditors myself? |
Absolutely, but lets be honest with each other unless you are a dentist you probably go to a dentist to get
your teeth taken care of right? So why would you try to negotiate a debt when you don’t know the rules
or have the connections and experience? Remember you’re going up against seasoned professional collectors
that do this for a living and they normally don’t take individuals seriously..
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| 11. Why does the money have to
be in your account before you can start negotiating my debts? |
Usually when the creditors offer settlement, they require a uniform payment. However, we try to stretch the
payments as much as possible. Having the savings helps to negotiate settlement in a better way.
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| 12. What
is the difference between bankruptcy and debt reduction? What is the benefit of avoiding bankruptcy? |
Bankruptcy
stays on your credit report for up to 10 years. Our debt reduction
program tells creditors that you did the right thing by paying
off your debts and therefore helps your credit rating.
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13. What type of debts qualify for your program? |
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We
work with most unsecured debts, such as credit cards, personal
loans, department stores, etc. We do not work with secured loans
such as car loans, (or leases), mortgages, home equity loans,
student loans, boat loans, etc.
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14. Do I have to give up my credit card accounts? |
No,
it would be wise to keep at least one credit card that has the
lowest balance and interest rate for emergency purposes.
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15. Will my credit card accounts be closed after I enroll in your debt reduction program? |
Yes,
the accounts will be closed because it is impossible for us
to get settlements from creditors if you keep charging to the
accounts.
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