Frequently Asked Questions Have a Question?
To start this response, let’s ask, “What is your credit score today?” It goes without saying that debt resolution will negatively impact your credit if you are a top borrower with a score between 750 and 850.
But the average client we work with has a credit score of roughly 620. And frequently, we view a credit score of between 600 and 660 as the lowest possible. This is because your credit score will enable you to be approved for credit cards that charge the highest interest rates, ranging from 2025 to 2040 percent, or it will get you something similar to a payday loan. Was this helpful?.
The business that created the score is where the name FICO originates. It comes from their original name, The Fair Isaac Company. It is not a credit reporting agency. It created this score to help lenders assess the financial risk of borrowers they are thinking about lending to. Was this helpful?.
Every twelve months, you are entitled to one complimentary copy of your credit report. Each credit reporting company offers a free report that you can obtain. AnnualcreditReport.com is the only official website where you can obtain your free report. com. Or you can give (877) 322-8228 a call to get your report. This report is absolutely free from Equifax, Experian and Transunion. When registering for services that charge you for these, exercise caution. It is truly a free report. Based on estimates, it is estimated that 2020% of consumers have errors on their credit reports, which can lower their credit score. So order your report and see if it’s accurate. Was this helpful?.
Five factors that are weighted according to specific criteria have an impact on your FICO score.
DebtBlue Program Why aren’t you making payments to my creditors?
You must realize that Debt Resolution is not a program for loans. Additionally, a creditor can only agree to accept less than what is owed to them or to reduce and waive a portion of the principal if they have a valid reason to do so.
There is no justification or incentive for a creditor to accept less than the principal amount if you are still making payments. You most likely won’t be eligible for our debt resolution program if you can afford to pay off your debt or to make the minimum monthly payments.
Debt resolution is exclusively intended for people who are experiencing financial difficulties and are unable to make their minimum monthly payments or repay their debt. We don’t pay creditors until we’ve successfully resolved your debt with them. After that, and with your consent, we’ll pay your account holder directly from your special purpose savings account. Was this helpful?.
One of the worst outcomes of a debt relief program is creditor calls.
If you owe someone money, they can call you at any time. On the other hand, there are numerous statutes and laws governing when and how creditors can make those phone calls. This covers the time, questions they can ask on that call, and the person they can get in touch with regarding your accounts.
The best part about answering calls from creditors is that we advise you to simply forward them to us. Since DebtBlue maintains direct connections with most creditors and collection agencies, we frequently have the ability to decrease or stop these calls on your behalf. Creditors will typically give up trying to collect if you are enrolled in our debt resolution program since they are aware that you are using DebtBlue to save money on your debt.
In other circumstances, we employ the Veritas, CLG Plus Plan, or Fortress Legal Plan to ensure that collection agencies and creditors do not infringe upon your rights under the Fair Debt Collection Practices Act (FDCPA). Should a breach occur, CLG Plus, Veritas, or Fortress will pursue legal action against the offending party. Additionally, if our clients’ rights are violated, they occasionally get paid a sizable sum of money. Therefore, if creditor calls start to get too much, make sure you work with our client success team. We’ll make sure you’re utilizing all available legal options to cut down on creditor calls. Was this helpful?.
Our typical client will graduate from their program approximately one or two months ahead of schedule, with a typical program length of 32 months. The precise dates will depend on whether your program has changed or if you are no longer participating in the process of depositing money into your special purpose savings account.
Thus, maintaining commitment and making your planned deposits are crucial to the success of your debt relief program. Was this helpful?.
Our fee usually amounts to approximately 25% of the total amount of debt that you enrolled in at the time of enrollment. Remember: no fees are collected up front. DebtBlue only collects its fee for that resolved account; we don’t get paid until we provide service and the creditor receives payment.
There is a $39 enrollment fee if you choose to sign up for the CLG Plus Plan, Veritas Legal Plan, or Fortress Legal Plan in addition to the fee that goes to DebtBlue. 95 a month. Additionally, there is a monthly charge for your deposit account that is less than $10. There are additional ancillary fees, such as when DebtBlue calls a creditor to initiate a payment. DebtBlue does not charge these banking fees; rather, your special purpose account does. Was this helpful?.
Together, we determined the approximate duration of the program using the best information at our disposal at the time. The length of a client’s program can vary depending on a number of factors, including your past drafting experience and the willingness of your creditors to settle your current escrow balance.
To guarantee the success of your anticipated time in the program, it is imperative that you remain compliant with your monthly payments. We use our best efforts to carry out services on your behalf with your best interests in mind, but we are unable to guarantee any particular outcome and have never done so. Was this helpful?.
The length of time required to produce a debt settlement varies depending on a number of variables. These include the amount of money you have available to pay your creditors, the age and balance of the accounts you owe, your financial hardship, and, finally, the willingness of your creditors to engage in negotiations. Please know that we are putting in a lot of effort to get you the best deal possible. Money talks with the creditors, so you can always add more money to expedite the process. However, they won’t negotiate unless you are past due by a certain amount. Was this helpful?.
We were able to work out a fantastic settlement for this account, but since you didn’t have enough money in your account to cover the settlement in full, we are paying them on a monthly basis to cover the settlement amount. This may also help you because it will allow us to start negotiating with your other creditors to expedite your program. Was this helpful? We also like to do term settlements because it allows us to do multiple settlements at once, which is another win for you.
If you are a co-signer or joint account holder, we would still like to proceed with settling the outstanding balance and arranging a settlement offer for you. Are you listed on any other enrolled accounts of the client? Was this helpful?.
The performance fee is already included in your monthly payment and is determined by the total amount of debt enrolled in the program. Now keep in mind that all of your deposits are accruing so that we can begin settling accounts as soon as possible. This is because we don’t get paid until we settle an account for you. Was this helpful?.
If you can no longer afford the monthly payment we budgeted for you, we have other options for you. You can choose to forgo one monthly deposit every twelve months, or we can review your financial situation and budget to determine whether anything has changed and offer recommendations based on fresh information.
Please understand that you want to pay off your debt as quickly as possible and that doing this will probably lengthen your time in the program. Additionally, it will benefit you more if we can settle your accounts quickly because these creditors won’t wait forever to be paid. Was this helpful?.
That depends on many factors. We assign negotiators to your account after your first draft is cleared, and they will evaluate your portfolio and come up with a strategy to pay off your outstanding balances. Our objective is to quickly help you pay off this debt and move toward financial independence. When a settlement opportunity arises, we will notify you by phone, text, and email. We will also keep you informed about our progress. Was this helpful?.
Finances Will this impact my taxes?
The short answer is no. But is it possible to be taxed for debt forgiveness? And that’s done with a Form 1099. According to the IRS, you must report any debt forgiveness that results in a portion of your debt being written off as income.
Since you did not pay taxes on that income, you must report it as 1099 income. Nonetheless, if you are in a solvent status, this is the most typical way that you pay taxes under a 1099 under debt forgiveness. Solvent status means you have more assets than liabilities. Our clients are usually regarded as being in a neutral status, meaning they have equal amounts of assets and liabilities, even after they graduate. Occasionally, they find themselves in a state of negative liability known as insolvency.
So, how will this affect your taxes? It won’t have any effect on your taxes. Will you get a 1099? Yes, you will. You’ll get that from your creditors. The great majority of our clients do not have to pay any taxes on the debt that has been forgiven, but you should check with a CPA to be sure. Was this helpful?.
You don’t have to have $10,000 in debt to enroll. We do accept some clients with debts below that figure. However, in order for debt resolution to truly help, you must have a significant amount of debt. Let’s look at it this way:
When you finish a debt resolution program with $10,000 after paying your fees and allowing the accounts to mature, you will most likely have saved very little money. However, your savings will be between $6,000 and $8,000 if you have $20,000 enrolled in a debt relief program. Similarly, if you enroll for $30,000, you will probably save $9,000, $10,000, or $11,000 in total.
Therefore, the benefit increases with the amount of debt you have enrolled. Also, it comes down to the Time Value of Money. If I told you that you could pay off $10,000 in debt today for only $7,000 or $7,500, you would undoubtedly conclude that the hassle would not be worth the $2,500–$3000 in savings.
The time value of money, however, would alter matters if the $7,500 could be repaid over a 30-month period rather than having to be paid back immediately. This is because you can spread out the payment over a 30-month period and there are no interest or penalties associated with the debt. NOW the program becomes much more palatable. Therefore, it’s not just that the $10,000 balance will be reduced and you’ll save money on it; it’s also about how long you can take to pay it off.
For the benefit of the client, that $10,000 cutoff is in place. Was this helpful?.
Debt resolution, debt consolidation, credit counseling, pay it off, and bankruptcy Was this helpful?.
Debt that is not backed by a property, such as a home, land, or vehicle, is known as unsecured debt. Debtors who did not demand collateral before granting you access to the funds are said to have unsecured debt. Credit cards, utility bills, department store cards, and medical bills are usually examples of this. Was this helpful?.
Yes. The credit card issuer may charge you an annual percentage rate (APR) as high as 29% if you fail to make a payment within the allotted time frame of more than sixty days. In the event that this occurs, the issuer is authorized to apply the 29% annual percentage rate to your outstanding balances. The Credit Card Act generally prohibits credit card companies from increasing the interest rate on the amount you owe; however, if a payment is past due by more than 60 days, they may do so. If you have had your card for a minimum of a year, they have the authority to raise your interest rate. They are required to give you a 45-day advance notice. Should your credit score have experienced a substantial decline, the issuer may also decide to increase your rate. Was this helpful?.
Yes, and they are free to do so without giving notice unless doing so would result in an over-limit fee and penalty. Was this helpful?.
At www, you can check if someone owes you money for free. missingmoney. com. Missingmoney. com is a database of governmental unclaimed property records. You might find money from things like:
You can access the unclaimed property from participating states and provinces by using this website. Searches and claiming are always free on this site. The site is updated weekly. When you search with your name, any money owed to you is promptly displayed. Was this helpful?.
General Why Choose DebtBlue?
DebtBlue’s program is proven to work. We develop a customized reduction plan with you. We handle the direct negotiations with your creditors so you don’t have to worry about the stress and strain of handling them. DebtBlue offers prompt, courteous service supported by more than 20 years of expertise. Was this helpful?.
DebtBlue designates as a “priority account” debtors who threaten legal action. Consider it as an attempt by a creditor to get around the queue, akin to someone purchasing a Fast Pass at a theme park and claiming, “Hey, I want to go straight to the front, so I’m going to take a legal action,” instead of having to wait in line. ”.
Creditors are aware that threatening you or instilling fear in you through a perceived legal action is a ploy used to get a client to pay a creditor more quickly.
In the event that you receive a summons, you should first contact your DebtBlue Client Success team. Then, you should forward the notice to DebtBlue, and we will handle the rest. Our priority accounts are resolved with great success, and we have Senior Negotiators assigned specifically to these accounts.
Generally speaking, less than 1% of all enrolled accounts will face aggressive legal action. For this reason, we provide our clients with additional confidence in these uncommon and special circumstances through the CLG Plus Plan, Veritas, and Fortress Legal Plans. Was this helpful?.
Simply put: Yes. In addition to being completely subject to federal regulation, debt resolution businesses must hold licenses, bonds, and registrations in each state where they conduct business.
You can determine whether a debt resolution company is legitimate by following these steps: Firstly, if the company demands payment up front, it is not a legitimate debt resolution company.
This is due to federal statutes that mandate services must be provided before any money can be received. If the business you are dealing with is a member of the American Fair Credit Council, that is another way to determine if it is legitimate. Every year, the AFCC conducts audits of all of its members to make sure they are abiding by all applicable state and federal laws.
So, is debt resolution legit? Yes. In addition to federal regulation, debt resolution businesses must obtain state licenses. Was this helpful?.
Absolutely. Several of our clients have also directly resolved their debts with their creditors. However, we compare this with representing yourself in court. It’s highly advisable that you have a lawyer with you. When it comes to handling debt settlement on your own, the one thing we emphasize is the need to ensure you have the appropriate documentation.
According to the accurate documentation, your accounts have been fully settled, and you will never again owe anyone for this debt. Additionally, you usually resolve an account one at a time when handling account resolution.
DebtBlue handles several accounts at once when resolving debts. This gives you the benefit of a volume discount. DebtBlue might, for example, offer to settle 100 accounts with a specific account holder.
These hundred accounts may total $50,000. Additionally, DebtBlue may offer $20,000 of this $50,000 to settle right away. By doing this, we can provide our clients with much better resolutions. Could this be put another way, DebtBlue is like Costco for the creditors and you come out on top?
Credit card companies are experts at using strategies like minimum monthly payments, low introductory rate offers that balloon into very high interest rates, late fees, and penalties to help you accrue more credit card debt. When you only make minimum payments, fees and interest mount up rapidly. Before you know it, the amount you owe on your card exceeds the initial charge. Was this helpful?.
No. It is illegal for credit card companies to seize your home in order to satisfy your debts. On the other hand, lenders may foreclose on your house if you have a home equity loan and you don’t make your payments or default on them. In order to repay the loan, the lender might want to recoup any equity you have in your house. Although they typically don’t want to, it is conceivable. Was this helpful?.
We still support you in achieving your objective despite the fact that a summons is merely another method of collection. Even though you received a summons, that doesn’t mean we can’t work things out through negotiation. Despite the fact that you are legally entitled to be sued by your creditors if you don’t pay them, court cases involving summonses are extremely uncommon. Was this helpful?.
No, a debt does not disappear upon a person’s death. Generally speaking, any outstanding debts must be paid by the estate of the deceased. When a person dies, their assets pass to their estate. Generally speaking, the debt will not be settled if there is no remaining cash or property. Depending on where you live, this will differ, so for more detailed instructions, please check your local laws. Was this helpful?.
Video Library Where can I view the DebtBlue video library?
Searching for our comprehensive video library? Look no further! Click this link to view a vast array of videos on a variety of subjects. Was this helpful?.
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FAQ
What kind of company is DebtBlue?
DebtBlue has been reducing credit card debt for more than 20 years. It’s the procedure wherein a credit card company agrees to take less money in exchange for the outstanding balance.
Is debt relief the same as a loan?
The term “debt relief” refers to a range of options intended to lower your payments and eventually help you become debt-free. It could be a new loan with a different interest rate or a different repayment schedule, or it could even result in a reduction of the total amount you owe.
Does debt consolidation give you a loan?
Debt consolidation loans: These loans can be obtained from banks, credit unions, and installment loan providers. These loans reduce the number of payments you must make by combining several of your debts into a single loan payment. Additionally, these offers may be for interest rates that are lower than what you currently pay.
Who is the owner of DebtBlue?
Corey Butcher recognized the need to empower and support consumers who were burdened by debt after witnessing friends and family members battle with credit card debt. Corey had a vision for DebtBlue, a company that would deal directly with the creditors of its clients and work out a satisfactory agreement.
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