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I have spoken to three debt companies and need help figuring out who to go with.

I have spoken to three credit repayment companies 1. Purchase power solutions 2. Credit care one 3. Accredited Care

They all said it would take 41-46 months, but Accredited said that their price is not performance based.

All the companies will get my debt lowered by 50% ($34,000).

Agatha

I have spoken to three debt companies and need help figuring out who to go with. by

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  • Anonymous

    Do some background research on each company. Look at the BBB website and reviews. Good Luck!

  • http://www.consumerrecoverynetwork.com/ Michael

    Hi Agatha,

    Given what you said about the three companies cutting your debt to 50% you have opted to look into companies offering debt settlement.

    Before determining a settlement company to hire be sure you have gathered all the information you need in order to evaluate all of your options. For example:

    Can you afford roughly 714.00 each month in order to pay off the debts in about the same time frame? If so, a debt management plan (dmp) would be another option to consider. The dmp would not expose you to the risks associated with a settlement plan, especially given the long program length that is being suggested to you. The state you live in and who your creditors are can increase your risks of being sued while saving money to fund settlements. If you live in a state where creditors sue more often (NJ, MO etc.), weighing that risk with a 40 plus month program is important.

    Can you qualify to discharge the debt in a chapter 7 bankruptcy? Speaking with a local bankruptcy attorney (or 2) will help you understand the benefits and drawbacks to bankruptcy. If you can file chapter 7, and it will not force the sale of certain assets or create other concerns for you, the “program length” in chapter 7 bankruptcy is roughly 6 months or less and you are protected from all of the risks associated with settlement.

    Use the debt relief calculator on this site to get a better understanding of the math and money involved with each option: http://getoutofdebt.org/resource/the-amazing-how-to-get-out-of-debt-calculator

    Understand the costs and time involved with debt relief options by reading the article on this site found here: http://getoutofdebt.org/33105/which-is-cheaper-credit-counseling-debt-settlement-or-bankruptcy

    If you are unable to qualify for a chapter 7 and would only have access to a chapter 13 repayment plan that mostly last 5 years, settlement would be an alternative, but a settlement program design that lasts 40 plus months is not ideal.

    Of the three companies you mention, 2 charge a fee based on performance. If it were me in your shoes that list would now be limited to those 2.

    Do all of the companies earn their fee as each debt is settled?

    Do they send limited power of attorney to creditors immediately? Doing so with creditors like Chase, Citi and Discover can prove problematic.

    What are the total fees charged by each company? The amount they charge in fees directly relates to the program length that is too long in my opinion and experience. Find out if any of the companies you mention are willing to reduce their fees to a level that will allow you to shave a year or more off of the program length.

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