Whether you’re in debt because of student loans, credit cards or medical bills, it can be hard to find the money to pay for your monthly obligations. Debt relief programs can help you get out of debt and save money.
These companies can help you negotiate with your creditors to settle a smaller amount than what you owe, but they aren’t free and could negatively affect your credit score. These companies generally charge a fee of 15 to 25% of the amount that’s settled.
They work on a “performance-based” structure, meaning you’ll only pay the fees if your debt is reduced.
In this case, a company will negotiate on your behalf to reduce your total outstanding balances and offer you a lower interest rate. This can significantly decrease your debt payments and save you money in the long run.
The company will also consolidate your debts and create a payment plan that’s easier for you to afford. They’ll provide you with a debt calculator to determine the amount you can afford to pay each month.
There are several debt relief options available to consumers, and you should research each one carefully before making a decision. You should also ask about any fees that are associated with each option.
Debt settlement is a form of debt relief that’s often used by people who have high-interest unsecured debt such as credit card debt, personal loans and medical bills. It’s an option that can save you hundreds of dollars in interest if you’re able to lower your debt and interest rates.
A debt relief specialist will review your financial situation, determine if you qualify for debt settlement and provide you with a free debt relief consultation. During the consultation, you’ll talk to a debt settlement specialist who will develop a customized debt-relief plan based on your goals, budget and eligible debts.
Accredited Debt Relief is a debt-relief company that was established in 2011. It works to help clients eliminate unsecured debts, including credit cards, personal loans and medical bills.
The website offers a free debt-relief consultation and claims to have helped over 200,000 customers resolve over $1 billion in debt. The website states that it serves residents of 31 states and Washington, D.C.
Its debt-relief specialists will evaluate your financial situation and create a personalized program that may include credit counseling, consolidation or debt negotiation. The debt-relief specialist will then submit your application to your creditors for approval.
Upon approval, your debt specialist will contact your creditors and discuss the terms of the settlement. Once the negotiations are complete, you’ll receive a check for the amount that was reduced.
These settlements are generally reported to the credit bureaus and can be a significant negative impact on your credit score. However, the effect will only last for a short period of time and you can expect your credit to improve quickly once the process is completed.
The debt-relief companies that we reviewed were transparent about their offerings and the fees they charge, and their customer reviews were generally positive. The best companies were those that offered a money-back guarantee and allowed you to cancel without penalty at any time.