Category 1
What company is this?
The name of our company is Advocate Debt Relief, a division of Start New Financial, we are based out of Grand Rapids Michigan, we are fully accredited with the Better Business Bureau and maintain an A+ rating and we are premier members with the Consumer Debt Relief Initiative.
If asked a question that you cannot answer prior to "qualify"
Great question, right now I don’t know what you qualify for. Once I figure out what you qualify for I can answer all your questions and give all the details of the program.
Is there a fee?
The monthly payment I just quoted is fully inclusive and includes the amount that goes to your creditors and any processing fees. This means that there are no upfront or surprise fees down the line.
The average fee is a fixed annual fee of 6.25% of the debt enrolled. This is a FIXED fee and is not an interest rate so it doesn't accrue and compound on top of your debt. And even though that fee is already included, we aren't able to collect on it until we settle your debt. This makes sure you are protected and that we will pay the creditors before we pay ourselves. And again, it's already included in the monthly payment so it's not anything extra.
What’s the interest rate?
There is no interest with this program. The whole point of the program is to eliminate the interest and reduce your balance to save you as much money as possible.
What does your company do?
Our company works with federally regulated options that get people out of debt faster and more affordably by reducing what they owe and eliminating interest on their accounts.
I'm not interested.
Would it be such a bad idea to hear what you qualify for? You are entitled to this information.
Do I continue to pay my creditors AND make this payment to you?
Great question. This payment will actually replace the credit card payments. So no, you are only paying this and are no longer paying directly to each creditor. While we negotiate, the creditors will be able to see that you are setting aside funds in your escrow account to pay them so they will know that you aren’t walking away from the debt.
Will closing accounts hurt my score?
The only thing closing the accounts may affect is your average age of credit. Most people already have a handful of closed accounts on their credit reports. Having the high debt amounts now is hurting your score much more than closing an account would.
How did you get my information?
You received the letter because your accounts were flagged as eligible for a federally regulated program, your eligibility is based upon credit data provided by the credit bureau.
Don't want to give permission to view debt records
I understand your concern, however, I’m not asking for any personal information. We have the ability to view your consumer debt records, it's just policy that I have your permission to view them with you.
How do I know the creditor will accept a settlement or negotiation?
Great question. We only allow creditors into the program who participate in debt resolution. Part of our approval process includes ensuring that we have negotiating relationships with your creditors and what their current rates of resolution are.
Will my credit cards be closed?
These programs are designed to help get you out of debt and keep you out of debt so part of the agreement with the banks is that you would no longer use that account. You aren’t burning a bridge with any of the creditors and you will be able to open new accounts with them in the future. Also, you do have the option to leave an account out of the program for emergencies if that would help you.
Is this a scam?
We are premier members with the Consumer Debt Relief Initiative, we have to follow federal and state regulations. In addition, we have an A+ rating with the Better Business Bureau. Scams definitely don't have A+ ratings with the BBB.
Why can’t I just try to settle the debt on my own?
You can definitely attempt to settle your debt on our own. However, the only people that usually settle their own accounts are people that have money already set aside to pay them. The reason is that when you settle on your own, the creditors will want the full balance within 90 days. By working with us, we are able to give you an affordable monthly payment instead of you having to pay thousands up front.
Because we have been in the business for so long and have experience working with these creditors, we already know what they settle for so there are no surprises.
The other value is the volume of debt we resolve with them. We are able to go to them with leverage as we are resolving many accounts at the same time.
Will I receive a 1099 from my creditors?
You may receive a 1099 from a creditor for the debt amount that was forgiven. In the event you do you will simply file an IRS form 982, which will cancel out the 1099 and you will not have to pay any taxes on the amount the creditor “forgave.” This is a simple one page form that any tax preparer can fill out if you do end up receiving a 1099.
Is this going to hurt my credit score?
Great question, one of the benefits of this program is, there is no long term impact on your credit. Right now, looking at your current financial profile, I can see that you are already on a downhill trend with your credit score because of the utilization and high debt amounts. That downhill trend would continue in the beginning of the program, however as your accounts are reduced and paid off, your score will start to improve and you will have an overall stronger financial profile.
Right now, you are actually a lending risk with the amount of debt you are carrying. With this program, you will end up eliminating your debt and coming out of it in a much stronger financial position. There is no third party reporting, your report will show that you satisfied your debt with the creditors.
Why isn’t your company name on the letter?
There are multiple enrollment centers across the country who are qualifying people into these federally regulated programs. The name of our enrollment center is Advocate DebtRelief, we are a division of Start New Financial based out of Grand Rapids Michigan. We have an A+ rating with the Better Business Bureau and we are premier members with the Consumer Debt Relief Initiative.
I am coming into money so I will just pay it off then.
That is great that you’re in that position! Most of our clients are not in that position. Those that are, they typically get started in the program to be wise with the funds they are coming into. You can pay off the creditors through resolution once you get your funds. This will save you even more money off the principal as you’re able to get a better resolution with a lump sum payment.
It makes sense to save as much as you can rather than throw that money away to the creditors, you’ve already paid so much in interest.
Will I have to deal with Creditor Calls?
If you are going to receive any calls, it's going to be in the beginning of the program as we negotiate down the balance and the interest. In the event you receive a call, the best advice would be to either ignore them since we are handling the accounts or to simply give the creditors our name and number and direct them to contact us instead. Once we reach agreements with the creditors, those phone calls will stop.
I don’t want my score to drop.
Answer: I get it, a lot of my clients tend to be concerned about their score. The reality is that credit score is only used to qualify for more debt. Do you have any major purchases coming up in the next 3-6 months like a car or home?
If no: Then you really won't be affected by a temporary drop in your score. By the time you need to make a major purchase like a car or home, you will be a much better lending candidate. The long term impact of saving all the money and being out of debt is far greater. A drop in credit is a short term pain for long term gain.
If yes: Ok, so you will want to make sure you have a strong financial profile. Paying down this debt as quick as possible is going to be the best way to do that. This program should really help you since it will eliminate the interest and help you pay down the principal faster and qualify for better rates on a loan.