How Debt Settlement Provides Relief

Debt settlement is one of three credit card debt relief services for consumers who are facing financial hardships. Often times, a consumer may owe payments to several different accounts and choosing the best debt relief option is a quintessential step in achieving financial freedom. Depending on a potential client’s individual circumstance, debt settlement may prove to be the best option for a number of consumers facing these particular troubles. FDR will assess each candidate’s situation thoroughly to determine if debt settlement is the best option to pay off their debts. Our debt settlement program offers a number of advantages that can potentially provide a consumer with the financial relief they are seeking. Here is an overview of these advantages and exactly how they provide relief to the typical debtor.

Upon completion of the program, our clients inevitably experience financial relief. FDR is, on average, able to settle our client’s debts for 40-60% of what they owe, as well as reduce the monthly payments they make during their tenure in the program. Essentially, with the reduction of monthly payments, this relief can be experienced sooner rather than later. This goes without saying that our program on average only lasts 2-3 years, far shorter than other debt relief programs such as credit counseling and debt consolidation.

Also, once enrolled in FDR’s debt negotiation program, you would be represented by us and fall under protection of the Fair Debt Collection Practices Act (FDCPA). FDR can claim power of attorney with your creditors as well as issue Cease and Desist letters to collection agencies. Also, our clients typically change their address and phone number that of FDR in order to reroute any nagging calls you may be receiving from your creditors or collection agencies. Historically, these calls can be very annoying and detrimental if they happen to contact you in the workplace where your privacy may be limited. And while we can not guarantee that the calls will cease, these steps will certainly reduce the number of calls you receive and provide protection against any illegal harassment techniques that the agencies may use.

And finally, upon the completion of our debt settlement program, the individual has an ample opportunity to improve their credit score, an essential factor in how future lenders determine the financial reliability of potential consumers. Making up 35% percent of your credit score is the Payment History segment, which includes a detailed summary of your payment history, including the accounts you have missed payments as well as the accounts you have paid off as agreed. Debt settlement specifically provides relief to this segment of your score in the fact that once a settlement has been reached, the account is considered “paid off.” The New Credit segment makes up 10% of your credit score, and debt settlement offers relief to this portion of your mark as well. Once graduated from our program, the individual can begin a life free of debt obligations and re establish a positive line of credit. Essentially, the New Credit segment of your score compares the proportion of new credit lines open to your past accounts. If the new accounts are managed well, this will positively affect that particular portion of your credit score. Furthermore, Amounts Owed makes up 30% of your score. Upon completion of a debt settlement program, instant relief will be provided to this percentage of your score as you would at that time be debt free and have no further payments to make to your creditors. With all of your debts paid off in completion, such a large portion of your credit score will result in drastic improvements of your credit report. Without any owed amount appearing on your report, lenders will be more likely to offer you credit when you apply, as you will be seen as a reliable consumer once again.