Did Freedom Debt Relief Mislead Us?


Dear Steve,

My husband suffered an injury that resulted in us going without income for a year and me having to cut back significantly on work hours to take care of him.

Now all is well, he is recovered, and we are backing working again. During this time, I placed 2 credit cards with Freedom Debt Relief.

We feel we have gotten misleading information from them. One of the debts has gone to collections, and the other is still with the credit card company.

Both debts have been negotiated, and even with their fees, it is a significant saving from the original amount.

Our ultimate goal is to have any negative items removed from our credit report asap.

We have the funds to pay off both debts in full. However, we would only do that if it helped our credit report; otherwise, we would go through Freedom to pay less.

Is it unrealistic to hope that by contacting the credit card and collections agency and offering to pay all or most of the debt owing, that they would be willing or able to remove the collection/delinquent payment from our credit report?



Dear Karen,

Well, that is an interesting situation for sure.

I can only answer the question based on the information you shared. It seems as if you contracted with Freedom Debt Relief, they were able to obtain some settlements you were happy with, and now your credit score is a higher priority. Did I get that right?

The client agreement you sign when you hire nearly every debt relief company will have a clause in it about the credit report impact, tax consequences, etc. I would be shocked if that was not in your client agreement.

The moment your balance was above 30% of your credit limit, your debt to income ratio was rising, or you fell behind on payments, the credit score impact had begun.

See also  I Am Working With Freedom Debt Relief and Chase is Suing Me. - Margaret

It seems Freedom Debt Relief negotiated some excellent settlements, you are on the hook for the fee already, and rebuilding credit is incredibly easy. See this.

What you seem to be asking for a commonly called a “pay to delete.” There is no guarantee a creditor would do that. Not sure what the benefit is to them since there are some real consequences to doing that and fewer benefits.

Besides, I think the horse is out of the barn already. If you decide to pay the creditors back in full, you would still owe Freedom for the work they have already performed for you. So you’d wind up paying much more in the long run.

My advice would be to stick with Freedom, pay your settlements off and pay Freedom for the services you contracted for, and then focus on improving your credit ASAP.

The good news here is your husband has healed, and things are certainly looking up.


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16 thoughts on “Did Freedom Debt Relief Mislead Us?”

  1. I used to work for National Litigation Law Group and left about 4 months before Freedom terminated the contract with NLLG. I’ve been rather vocal about my low opinion of Freedom. They’ve blocked me form their Facebook page and their Twitter account.

    Freedom is incredibly sketchy and even tried to get their clients to undermine my advice. I would not recommend to anybody under any circumstances.

  2. Gentlemen…My understanding is that the statue of limitations is in place only to prevent creditors from taking legal action after the time is up, however it does not wipe out the debt. Does the debt being unpaid still negatively affect the credit report up until 7 years has passed from last payment? Is it not better to have the report show partially paid instead of remaining outstanding and delinquent? If one was close to the 7 year mark then yes I would think it would be pointless to pay in part or in full but is it not better to do so if you are let say 2 or 3 years out? If I am wrong please feel free to correct me:)

    • Karen,

      The SOL can be a bit confusing and it is in a slow state of flux. As it stands now, the SOL only blocks a suit over expired debt if it is raised as a defense by the consumer when sued. It does not universally prevent anything. However, consumers will start to see more notices on collection statements about the SOL in fine print in the future.

      Yes, the history of the debt will remain technically for 7 years and 180 days from the time it went delinquent. Typically it is removed after 7 years. But if there focus on rebuilding good credit then the older delinquency carries less and less weight.

      And a point that is often missed is that a settlement can result in a notation that can last the same amount of time. The amount of debt forgiven in the settlement can be reported as a bad debt.

      Financial decisions must be made based on facts and priorities. So, if the goal is to attempt to maximize the rebuilding of credit ASAP then if the debt is paid off in full and the focus is made to rebuild credit again by getting back in the game, that would be one approach.

      If the goal is to engage a solution that makes the most mathematical sense then preserving funds by settling, investing the balance for retirement to let it grow, and focus on rebuilding credit fast, has a more logical long-term positive impact.

      Ultimately, all I and others can do is give the consumer the facts, options, and allow them to make their own decision.

      You are awesome for asking the right questions.

  3. Karen, regarding the credit scoring aspect there is no real benefit to paying an old debt in full – unless they are agreeing to completely delete the item from your reports. Keep in mind sometimes they will completely delete an item after settling for less than the full balance too. Unless paying in full is the only to negotiate a total deletion save the extra money and just settle it. You can probably settle a debt that old in the 25-45% of the balance range.

    As Steve said, if you can confirm it is outside of your state’s statute of limitations there may not be much reason to pay them anything.

  4. Steve and Timothy….This brings up an important question.
    When a person has very delinquent debts (several years), is it more beneficial to your credit report to pay in full vs a decreased amount negotiated by a company like Freedom?

    • Great question. Ultimately the answer is what is the capacity of the consumer to fund the full settlement and are they going to be structured about rebuilding their credit quickly. From my POV the deciding factor is the time from when the account was last reported as delinquent. A lump-sum settlement would show the part of the debt forgiven as bad debt but the account closed.

      And if the debtor is not going to make rebuilding their credit a priority, then there is less of a rush.

      If debts are several years delinquent I think there is another consideration, the Statute of Limitations (SOL). It might be that the pain has already been taken and if a consumer can get an attorney in their state to confirm the debts are expiring past the SOL and knows how to handle that, then settlement might not be something to rush to.

      But that’s just my opinion.

  5. I totally agree with Steve, the only caveat that I think should have been added was that Freedom Debt most likely put you in a term settlement with these creditors and you are paying monthly towards that. If you have the funds available you should pay the settlements off in one lump sum so that the accounts shows a zero balance and this will also help your credit to rebuild faster. If you continue to pay the term settlement in monthly payments the High balance on the credit report will continue and negatively affect your credit. Your credit will improve fast if you take the right steps.


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