Debt Reduction
Steps
The Debt
Reduction Program is
very effective.
We have Lawyers
in 48 state except
WI and West VA.
Here is a
step-by-step
overview:
Step 1:
Call or e-mail us
for a free
consultation. Our
Lawyers will assess
your financial
situation and
determine your
potential for debt
reduction.
Step 2:
We will work with
you to determine the
appropriate monthly
dollar amount that
you plan to save
towards a negotiated
settlement. This
amount is typically
significantly less
than your current
minimum payments,
and goes toward
paying off your debt
(not simply paying
credit card interest
charges). These
funds will be saved
every month in a new
account that you set
up and control.
Step 3:
Once you enroll in
the "Debt Reduction
Program" Our Lawyers
will contact your
creditors in an
attempt to handle
future creditor
communications. You
are requested to
avoid using credit
while on the
program.
Step 4:
After funds have
accrued to make
reasonable offers,
we begin negotiating
with your creditors
individually.
Typically, we
attempt to reduce
debts by at least
45% of your current
balances. We stay in
contact with you to
keep you apprised of
your situation.
Please note, it may
take several months
of savings before we
are in a position to
make settlement
offers by our
lawyers.
Step 5:
Once a settlement is
negotiated by our
lawyer, with a
creditor, you will
be notified via a
"Good News"
notification from us
or log in to your
account and you be
able to see all the
settled account.
Step 6:
After the account is
paid, your creditors
may report to the
credit rating
bureaus that your
accounts are
"settled in full,"
"settled," "paid,"
"paid by
settlement", or
"settled for less
than the full
amount." Either way,
you no longer owe on
this account and the
balance is zero.
Congratulations, you
are now free of that
debt!**
After the Program:
If you are
interested in
purchasing a home,
purchasing an
automobile, or
related financial
services products -
we can help you find
a company to apply
for access to other
products. Or, if you
simply want to talk
about a financial
services decision,
we will always help
you think about your
best strategy for
staying debt free
and building
personal wealth.
* Estimates based
on prior results;
individual results
will vary based on
circumstances,
including your
ability to save
sufficient funds and
complete the
program. We do not
guarantee that your
debts will be
lowered by a
specific amount or
percentage or that
you will be
debt-free within a
specific period of
time. We do not
assume consumer
debt, make monthly
payments to
creditors or provide
tax, bankruptcy,
accounting or legal
advice or credit
repair services. Not
available in all
states. Please
contact a tax
professional to
discuss tax
consequences of
settlement. Read and
understand all
program materials
prior to enrollment.
**Please note,
Financial Credit
Relief is not a
credit repair
organization.
Debt Reduction
FAQ's
Q. Will I be totally
debt free when I’m
done?
Our program
is focused on
dealing with only
unsecured debts
(credit cards,
medical bills,
unsecured personal
loans). We cannot
help you with debt
that is secured by
collateral (such as
mortgages or auto
loans). After
completing the
program, however,
the money that you
are no longer paying
towards your
unsecured creditors
can now be used to
pay down secured
debts, as well as to
save for your
financial future.
Q. Will I have to
take out another
loan to cover my
current debts?
No. Our debt
reduction program is
not a new loan. Some
of our clients will
use a
“consolidation” loan
in conjunction with
FCR’s debt
negotiation program,
but most fund their
settlements with a
monthly payment into
their settlement
savings account over
the program period.
That being said, we
do have a
relationship with a
lending company, and
some clients who
demonstrate a
consistent pattern
of saving their
monthly draft amount
on time may be
eligible for a loan
to pay off one or
more of their
settlements. Of
course, this is
never something that
is required of any
FCR client.
Q. How is the
service fee paid,
are they paid
upfront?
Our fees are
not charged upfront
– instead they are
withdrawn from your
new settlement
account each month.
Typically our fees
are spread out over
a period spanning
18-19 months. The
fee is typically
broken into a
Retainer fee, that
is paid out over the
first 3 or 5 months,
and then a Service
fee that is paid out
over the following
15 months. All fees
are included in the
one monthly savings
amount that our
account executives
will quote to you.
Keep in mind that
the amount of the
fee and the time
period over which it
is charged may
change depending on
the state you reside
in.
Q. Should I put all
of my credit cards
in the program?
If you have
one card with a low
balance that you can
quickly pay down to
zero, then you may
hold onto it for
emergencies. However
the program will
generally not work
unless you enroll
all of your high
balance (greater
than $500) credit
card accounts. As
you can imagine, it
makes it difficult
for us to negotiate
with your creditors
if they can see that
you are negotiating
on some accounts but
not others.
Q. Who controls the
bank account where I
am saving funds for
creditors?
You do. The
bank account is set
up in your name and
the money in the
account is your
money. The reason
why we recommend
keeping it in a new
account that is
separate from your
existing bank
accounts, is that in
our experience, this
separation
dramatically
increases (by a
factor of 2-3
times!) the
probability that you
will succeed in
FCR’s program. FCR’s
fees are deducted
from this account
each month,
according to the
Agreement that you
sign with us. But
the accumulated
savings in the
account are owned by
you.
Q. How does this
affect my credit?
If you do not
make required
minimum payments to
your creditor you
may be breaking the
terms of your
agreement with them
and your actions
will probably be
reported to consumer
reporting agencies
as a late,
delinquent,
charged-off or past
due balance. This is
true whether or not
you have enrolled in
a Debt Settlement
Plan. Depending upon
the condition of
your credit report
at the time of
enrollment, a Debt
Settlement Plan may
have an adverse
effect on your
credit report and
credit score. Our
goal is to get you
out of debt for the
lowest cost, in the
shortest period of
time without
declaring
bankruptcy.
Q. Will I receive
phone calls from
collectors?
CallShield"
was invented by an
attorney group to
relieve the stress
of harassing
collection calls to
consumers who are
enrolled in a debt
settlement program.
Settlement
Corporation then
helped the attorney
group customize the
workings of The
Shield to best
address collectors
who call consumers
while they are
enrolled in our
program. The Shield
will re-direct any
collection calls
clients may receive
to our office
without them having
to say a word or to
ever speak to a
collector.
CallShield can
dramatically improve
your company's
retention rate and
closing ratio when
used correctly.
Consumers are wary
about enrollment in
a debt settlement
program as they can
be harassed by
creditors while
enrolled. Use the
Power of The Shield
to help you close
more deals and keep
more deals on the
books for a longer
period of time.
CallShield" was
invented by an
attorney group to
relieve the stress
of harassing
collection calls to
consumers who are
enrolled in a debt
settlement program.
Settlement
Corporation then
helped the attorney
group customize the
workings of The
Shield to best
address collectors
who call consumers
while they are
enrolled in our
program. The Shield
will re-direct any
collection calls
clients may receive
to our office
without them having
to say a word or to
ever speak to a
collector.
CallShield can
dramatically improve
your company's
retention rate and
closing ratio when
used correctly.
Consumers are wary
about enrollment in
a debt settlement
program as they can
be harassed by
creditors while
enrolled. Use the
Power of The Shield
to help you close
more deals and keep
more deals on the
books for a longer
period of time.
In addition, we will
work with you to
make sure violators
of collection laws,
including the Fair
Debt Collection
Practices Act
(FDCPA) are
appropriately
handled.
Q. Will I owe taxes
on my forgiven debt?
The IRS
considers a forgiven
debt as taxable
income, so at the
end of the year,
they will expect
taxes to be paid on
the settlement. The
IRS, however, has a
form (Form 982)
available for
certain hardship
situations that may
exempt you from this
tax. Please contact
a tax advisor to
discuss this issue
further.
Q. Do interest and
late fees accrue on
my accounts?
If you let
your accounts go
delinquent, your
creditors will
continue to add
interest and late
fees onto your
balances. Typically,
your balance will
increase until a
settlement is
reached. Keep in
mind that the
interest is going to
accrue regardless of
whether you make
minimum payments or
not. FCR’s goal is
to negotiate
substantial
reductions to the
balances on your
accounts, even after
the interest and
late fees have
accrued.
Q. Could I negotiate
on my own?
Yes you can.
You can also do your
own taxes and repair
your own car, but
most people choose
to seek help. Most
people prefer to
leave these tasks to
experienced people
who earn their
livelihood as
specialists in those
lines of work. Our
team of debt
negotiation
specialists has only
one job -
negotiating
reductions on our
clients’ unsecured
debts, each and
every day of the
week. Our knowledge
and experience puts
us in the best
position to stand up
to your creditors
and fight for the
best settlement
possible. Together,
FCR’s team of
negotiation
specialists are
resolving
approximately
$30,000,000 of debt
each month (and
growing!).
Q. Do you begin
negotiating with my
creditors right
away?
Except when
dealing with certain
difficult creditors,
we generally contact
your creditors right
away (typically
within approximately
1-2 weeks of your
joining our program)
to let them know
that we have Limited
Power of Attorney
and to request that
future collection
calls come to us and
not you. The actual
negotiation activity
is typically very
limited until you
have saved up enough
in your settlement
account to make
reasonable offers to
your creditors. Most
(but not all)
creditors do not
want to spend time
negotiating an
account unless they
know there are funds
available. The first
settlement typically
happens in month 6
to 9 of a client’s
program (this varies
greatly and depends
on your monthly
savings amount and
the number of
creditors you have
enrolled in the
program as well as
the balance of each
individual account).
In some instances it
may take more than 9
months before the
first settlement is
reached.
Q. Will my debts be
sent to a law firm?
Will this result in
a lawsuit?
Creditors do
have the right to
send debts to third
party collection
agencies and/or law
firms in order to
collect a debt. If
this happens, we
will continue to
negotiate on your
account and will
treat the debt as a
priority creditor.
Based on our actual
experience, it is a
small percentage of
cases on which
lawsuits are
actually filed. When
this does happen,
usually the purpose
of the lawsuit is to
force a settlement.
We will continue to
negotiate to settle
the debt, although
the settlement
percentages are
often higher than
typical “non-legal”
settlements. If a
lawsuit is filed
before you have
saved up enough
funds to negotiate a
settlement, we will
seek to resolve the
account by putting
it on a long term
payment plan for
100% of the balance.
Please note, we are
not a law firm and
cannot provide legal
advice or legal
representation.
Q. Do you guarantee
that you settle all
of my debts for a
certain percentage?
No. Every
case is a
negotiation, and
there is no
guarantee how the
negotiations will
wind up.
Furthermore, the
success of our
negotiations is
highly dependent on
your ability to save
a specified amount
each and every month
you are in the
program.
Q. Will entering
your program repair
my credit?
No.
We are not a
credit repair
company, Our
goal is to
negotiate
settlements at
less than face
value on your
unsecured debts.
