I came across these questions below on a debt settlement company site, New Era Debt Solutions, and I was really impressed that they were really open and honest about the problems consumers face with debt settlement and what to watch out for. So, with permission, I present to you the Fourteen Questions to Ask Any Debt Settlement Agency from the New Era site.
1. Are you a member of TASC?
TASC, The Association of Settlement Companies, is the largest trade association serving the debt settlement industry. TASC members voluntarily agree to comply with TASC’s strict industry standards. Any company you choose should be a member. If not –Red Flag!
New Era Debt Solutions is a proud member of TASC.
2. What are your fees?
A company should charge fees based on performance and results. Most companies charge a flat fee based on a percentage of your debt amount. The problem is that they collect their fees up front, before your debt is settled. The majority of fees should only be paid after the work is done, not before! If a company is collecting their fees in advance of the work being done -Red Flag!
The majority of New Era Debt Solutions fees are based on settlement results. If New Era Debt Solutions doesn’t save you money they simply don’t get paid.
3. Are you being paid commission?
Salespeople may stretch the truth or leave out vital information if they are paid by commission. If they say yes –Red Flag!
New Era Debt Solutions representatives are not paid by commission. They are paid to give you honest answers and solutions to your debt situation.
4. Do you have a money back guarantee if I change my mind?
Don’t accept anything less than a full 30 days. Anything less –Red Flag!
New Era Debt Solutions provides a full 30 day money back guarantee.
5. If I have faithfully made my payments for one year and you haven’t settled any of my debt, how much money would I get back if I decided to quit?
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 –Red Flag!
With New Era Debt Solutions you would get back 100% of your money.
6. How long have you been in the debt settlement business and how much debt have you settled?
Many companies don’t settle much debt at all, and young companies have very little experience. If the company cannot provide proof of their experience – Red Flag!
New Era Debt Solutions’ clients are serviced by Settlement Headquarters. They have been settling debt for 8 years and have settled more than $118,592,502.00
7. Can you stop my creditors from calling me?
It is not possible to stop all creditor calls. If they say they can – Red Flag!
New Era Debt Solutions will take steps to reduce creditor calls and will provide the services of Consumer Justice Group at no charge for help with abusive collectors.
8. Will you be making monthly payments to my creditors?
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.
9. Can I get sued?
The answer to this question is yes; it is a possibility. If they say anything to the contrary – Red Flag!
New Era Debt Solutions will continue to negotiate a settlement even if a lawsuit is filed.
10. Will this have a negative effect on my credit report?
The answer to this question is yes. All debt management programs will have a negative impact on your credit report. If they say anything to the contrary – Red Flag!
Your number one concern should be to eliminate your debt. New Era Debt Solutions’ number one goal is for you to become debt free as quickly and inexpensively 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. Any longer than 12 months – Red Flag!
Many New Era Debt Solutions clients begin seeing settlement offers in as little as 90 days, and sometimes even sooner.
12. Can you tell me exactly how much this will take and exactly how much this 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 would be a Red Flag!
New Era 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. This should be explained. If not – Red Flag!
A savings of over $600 may or may not be taxable depending on your individual and unique situation.
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 – Red Flag!
New Era Debt Solutions recommends the escrow services provided by NoteWorld. Your funds are held in an FDIC insured trust account.Fourteen Questions to Ask Any Debt Settlement Agency by Steve Rhode