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Debt Relief Services and Debt Consolidation from Active Debt Solutions
Fourteen Questions to Ask
Debt Settlement is a viable option to help you negotiate your unsecured debt. Unfortunately, some companies take advantage of people who need debt reduction assistance; and if you choose the wrong company, you may find yourself in worse shape than you were before.
This article is designed to help you select the best debt settlement company. Keep these 14 questions - and their answers - in mind as you make your decision.
No debt settlement company should charge you any fees at all unless or until your debt is settled. Performance-based fees have always been the best model for the consumer. Recently, the Federal Trade Commission (FTC) made it law and as of October 27, 2010, anything besides paying for performance is simply illegal. Fees can only be collected after a settlement has been made and approved by the client.
Some debt settlement companies are attempting to circumvent the law by claiming a "legal model" exemption. There is no such exemption. Some companies will try to sell you a product to get money from you in advance. This is just a way to get money from you up front.
Active Debt Solutions does not charge you any upfront fees whatsoever. Neither should any other company. When you pay money up front, not only does it hurt your ability to get out of debt, you are gambling on a company that may be forced to shut down by the government.
A debt settlement company should charge fees based on performance and results. Beware of companies charging a flat fee based on a percentage of your debt amount. These companies collect their fees – usually up front, before your debt is settled – regardless of how successful they are at settling your debt.
You should pay the majority of fees only after the work is done. This is the way Active Debt Solutions works. If we don't save you money we simply don't get paid.
You should only be charged a fee if the settlement company saves you money. After all, that's why you hired them. Your debt settlement firm should be willing to provide you a written guarantee.
Active Debt guarantees - in writing - that you won’t pay any fee unless we save you money.
A money-back guarantee gives you time to carefully consider your decision after you've had a chance to see how the program works. Don't accept anything less than a full 30 days. This is what Active Debt Solutions provides you.
Many companies charge excessive fees whether or not any of your accounts are settled. If fees are based on a percentage of the debt and not tied to results, the company will probably refuse to make any refund of your fees… and that's not fair!
With Active Debt Solutions you would get back 100% of your money.
Many companies have rushed into the debt settlement business over the last few years. Some companies don't settle much debt at all, and young companies have very little experience. Ask for proof of their experience.
Active Debt Solutions' clients are serviced by us- alone. We have been settling debt for 4 years and have settled millions in consumer debt.
As much as everyone would like to stop all creditor calls, it is simply not possible. If a debt settlement company says they can do this, they are not being honest.
Active Debt Solutions makes every attempt to get creditors to deal with us instead of bothering you. If you are being harassed we may refer you to a lawyer versed in your rights to creditor harassment.
Settlement companies do not make monthly payments to your creditors. If they claim to do so or if they give you the impression that they do – Red Flag! Creditors are not paid until after a mutually agreeable settlement is negotiated and approved.
The honest answer to this question is yes; it is a possibility. If a settlement company says anything to the contrary – beware!
Although we can't promise you won't be sued Active Debt Solutions will continue to negotiate a Active Debt Solutions settlement even if a lawsuit is filed.
The honest answer to this question is also yes. All debt management programs will have a negative impact on your credit report. Some options have a greater impact than others.
Any type of service you use - credit counseling, bankruptcy, debt settlement, or debt consolidation - can have a negative effect on your credit. Your concern shouldn't be about your credit, but getting out from under your debt. Our goal, if you choose us is to help you get out of debt, will be settling your debt as fast as possible.
11. When can I expect my first settlement?
Your first settlement should be made well within the first 12 months of your program. Many Active Debt Solutions clients begin seeing settlement offers in as little as 90 days, and sometimes even sooner.
12. Can you tell me exactly how long this will take and exactly how much it will cost?
Debt Settlement is not an exact science, and there are too many variables to quote exact time frames and figures. Many companies will tell you anything to get you in the door. Any attempt to provide exact information should be questioned!
Active Debt Solutions provides estimates only of time frames and costs. These estimates are based on current company averages.
13. Are there tax consequences I should be made aware of?
The answer is yes. The debt amount forgiven may be a taxable event and this should be explained to you. A savings of over $600 may or may not be taxable depending on your individual and unique situation. If you receive a 1099 we will forward you IRS Form 982, when filed by tax advisor may well forgive the debt.
14. Who is holding my money while I'm waiting on a settlement?
Your funds should be held at a third party escrow company in an FDIC insured trust account. If the company tells you to save your own money or to send the funds to them – watch out!
Active Debt Solutions recommends the escrow services provided by Global Client Solutions. Your funds are held in an FDIC insured trust account.
Reprinted With Permission From our friends at New Era Debt Solutions, Mr. Dan Smith- President
