If you’re wrestling with credit card debt and no end is in sight, you need help. And if you happen to be a California resident, you may be interested in services offered by California Debt Relief, which can connect you to a debt settlement company that may be able to put you back on a solid financial track. Here’s how the organization works, and more.
What Is Debt Relief?
It’s when you hire a company to see whether the companies you owe would be open to letting you pay part of your debt in exchange for having said debt marked as “settled” on your credit reports. Creditors typically cooperate because if they don’t, you’ll probably file bankruptcy – the financial strategy of last resort – which will likely net them zero. They know this.
How Does It Work?
The debt relief company will go over your situation with you then formulate a payment plan. After that, you’ll be asked to deposit cash monthly into an escrow-type account that’s controlled by you and backed by the federal government. Once you’ve saved enough – the amount depends on your goals, income, and debt load – your negotiators will see whether your creditors are open to settling, and if so, at what savings (with some debt settlement companies, you can save up to half of what you owe). Once each settlement is reached and approved by you, payment will come from your account.
What About My Credit?
Because you’re paying your creditors indirectly and at length, the process of debt relief does cause a credit score downturn. Your scores will bounce back, though, once your debts are cleared and you start rebuilding your credit. And anyway, aren’t your scores already low right now?
What Kind Of Debt Must I Have?
For California Debt Relief you’ll need at least $7,500 worth of unsecured debt, meaning financial obligations that aren’t tied to collateral, usually a house or car. In addition to credit card debt, this means personal loans, medical bills, private student loans and other unsecured outstanding balances.
How Much Does California Debt Relief Cost?
The 16-year-old company is a small business owner’s debt relief connection service – it’s not a direct provider — meaning it hooks you up with a BBB-accredited debt settlement company that may be able to help. It also offers do-it-yourself tools. For all that, it charges nothing, although there may be nominal enrollment program administration feels. The company also matches customers with companies that help with debt consolidation and debt counseling.
You also can request a savings estimate to learn what debts are eligible for relief through California-approved debt relief companies.
How Long Does The Process Take?
The typical turnaround is two to three years, although your first settlement may come within months. Remember, you didn’t get into such financial issues overnight.
Why Can’t I Pick Out My Own Debt Relief Company?
You absolutely can. But more than most, the debt settlement industry is rife with people who are more interested in lining their pockets than helping you get out of debt. For instance, some companies will try to charge you upfront, before they’ve settled a single account. That’s illegal, but some companies try it anyway.
You need a settlement company that’s established, reputable, and accredited. Unless it’s a company such as Freedom Debt Relief, that may be time-consuming to find on your own.
So, that’s what you need to know about California Debt Relief. If you’re a resident of Cali, you would do well to take advantage of the services it has to offer to regain your financial footing.