Credit Card Debt Consolidation Program FAQ

How do the creditors actually get paid?
If you are consolidating credit card debt through debt settlement, you pay your creditors only when you have achieved a mutually agreeable settlement. We recommend that you make this payments by cashier's check or money order not by a personal check from your checking account. We do not recommend payment by phone.

How do I pay for these settlements, how does it work?
This is a very good question. If you're unable to make the monthly payments on your debts you probably don't see a way to come up with funds for a settlement either. In general there are two ways to do it depending on your circumstances, which we'll describe below.

Lump Sum - If you are unable to make the monthly payments due to an accident at work or a traffic accident or something like that, you could use the insurance settlement (or part of it) to pay for your settlements. Some people are able to obtain help from family members to settle their debts in a lump sum. You might also be able to obtain lump sums of money from selling personal assets such as cars, stocks, bonds, collectibles, etc.

Save the Money Over Time - This is by far the most common method of paying for settlements. Let's say your budget would allow you to pay about 80% of your total minimum monthly payments but you can't get your monthly payments reduced by that much. Rather than struggling with that and falling behind with an empty bank account, you put that 80% of your minimum payments in the bank every month until you have enough money to negotiate a settlement with one of your creditors. That settlement would deplete your funds and you'd have to continue save money every month until you had funds for the next settlement. This process repeats until you have the funds to settle all of your debts.

What happens to my creditors while I am on the program?
Your creditors are likely to take actions to collect on what you owe. That could mean phone calls, letters, sending the account to collection agencies and so on. Basically they're not going to sit around on their hands while you're saving money for your settlements.

In a debt settlement program, accounts are settled one at a time unless you have been able to obtain sufficient funds in a lump sum to conduct simultaneous negotiations with your creditors. This means that one account will be handled within a few months but it could take a few years for some of them to get settled.

Will the creditors start calling and harassing me?
In a word - yes. As someone goes delinquent with their accounts, especially in the beginning, they will get creditor calls. You will be taught various methods for minimizing this interaction and the upset that goes with it as part of your program.

What happens to my credit?
While you are not paying your creditors they will report delinquencies to the credit bureaus. They will also report any charge-offs, collection agencies or lawsuits on your accounts. These are all negative items and they all reduce your credit score. This is why we do not recommend consolidating credit card debt through debt settlement for anyone who is capable of making the monthly payments on his or her debts. However if you cannot afford your monthly payments on your accounts you are going to fall behind. If you fall behind you are likely to have delinquencies, charge-offs, collections, and so on anyway.

Can I do it myself?
You definitely can do it yourself. That's what our program is about, teaching you how to do it yourself and giving you the moral support and advice you sometimes need to get through any rough patches you encounter. Can you do it without our program? Sure. You can buy "The Debt Survival Kit" or any other debt settlement education you choose and go from there.

Can't you do it for me?
Our program is designed to provide education and assistance to teach people proven techniques for consolidating credit card debt through debt settlement. We feel you should try to get it done yourself first. This program is not what some call "full service" where we represent you in negotiating settlements with your creditors and we do all the work for you. If, in the course of your program, you encounter a situation you feel you just can't handle you can apply for an experienced negotiator to settle that account for a fee. A full description of the terms and conditions for this service is available to our members only.

How long will it take?
Because of the nature of this program we cannot answer this question. The length of the program is determined by the total amount of debt you have, how much you actually set aside toward your settlements every month and the outcome of your negotiations with your creditors. You can estimate a rough time frame if you figure out what you can afford to put toward settlements every month. Once you have figured that out you calculate the estimate based on the assumption of 50% settlements on average. Here's how: multiply your total debt by 50% then divide that by the amount you can afford to put toward your settlements every month. The result is the estimated number of months it might take you to get out of debt by consolidating credit card debt through debt settlement.

How much can I save through negotiating settlements?
This is also difficult to answer with any kind of accuracy. The outcome of your negotiations depends on your communication skills and how well you apply the techniques our program teaches among other factors. We have seen savings on individual accounts as much as 93% (debtor paid just 7% of the balance due) all the way to no savings at all because a creditor refused to settle. Generally you should try to get the creditors to settle for 50% of the outstanding balance or less.

Are there any kinds of accounts that can't be settled?
Secured accounts and student loans guaranteed by the government usually cannot be settled. It is possible to achieve settlements on any type of unsecured account. Some categories of unsecured debt can be more difficult to settle than others though. The two most difficult categories in our experience are debts to banks resulting from overdrafts and debts to payday loan companies. Settlements in these categories of debt are somewhat rare.

How do I know if consolidating credit card debt through debt settlement is right for me?
The most important question you have to ask yourself to determine whether or not you should consider consolidating credit card debt through debt settlement is, "Can I make the minimum monthly payments on all of my debts on my current income?" If the answer to that is no, then you are likely to fall behind on your debts whether you try consolidating credit card debt or not. You're just not making enough money to cover everything.

If you can make the minimum monthly payments on all of your debts on your current income you may still consider consolidating credit card debt through debt settlement if getting out of debt rapidly is more important to you than your credit score, possible legal action by your creditors and all of the other potentially negative site effects of this program. However if you're unsure about your willingness to tolerate those things DO NOT START THIS PROGRAM or any similar program.

How much does it cost?
Since our goal is to teach you how to negotiate with your creditors yourself, you only need to stay on our program long enough to feel you've gotten to a point where you feel confident with the process. That could be one month or several months or several years. It's entirely up to you. Let's see how our costs compare with a typical debt settlement company that charges you 15% of your debt for their services.

This comparison assumes that you meet their minimum debt amount of $10,000 and that you stay on the program until all of your debts are settled (let's say 36 months). The cost of their program would be $1500.00

If you stayed on our program for a similar length of time you'd make 36 payments of $24.95, which would total $898.20.

You could reduce the costs of our program further if you only stayed in it long enough to get confident with the process of settling your debts. The cost difference becomes even more significant if you have more than $10,000 in debt. The cost of our program is based on how long you stay in. The cost of their program is based on how much debt you have. The more you owe the more it costs.

By the way, we do not require any minimum amount of debt for our program.