Sunday, 25 August 2019

Accredited Debt Relief Review

Accredited Debt Relief Review
16 Dec
11:49

Debt isn’t just common in America — it’s the norm.

According to Northwestern Mutual’s 2018 Planning and Progress Study, more than 75% of people are in debt. Those in debt owe over $38,000 on average, and that’s before you include a mortgage. Additionally, 20% of respondents said they spend at least half of their income on loan payments.

Accredited Debt Relief is one of many debt relief companies that consumers can turn to when they’re struggling with overwhelming debt.

Here’s everything you need to know about Accredited Debt Relief and its services.

What is Accredited Debt Relief?

Unlike other debt relief companies, which may focus on one product or debt relief program, Accredited Debt Relief is a referral service. The company’s representatives will review your situation and recommend other companies that can best help you manage or settle your debt.

Accredited Debt Relief works with partners that offer four types of debt relief services. Depending on the program, you may be able to lower your monthly payment, decrease your interest rate, simplify the repayment process, settle for less than your balance or eliminate debts.

Breakdown of Accredited Debt Relief

Want to learn more about Accredited Debt Relief? Here’s a comprehensive look at its services and requirements.

Services offered

  • Debt consolidation

  • Debt management

  • Debt settlement

  • Bankruptcy

Minimum debt required

$7,500 in unsecured debt

Credit check

Yes, in some cases

Debt settlement timeline

12 – 48 months

Consultation fees

No fee for an initial consultation

Cancellation fees

N/A

Service fees

Generally 5%-7% of the debt that you enroll in a program

Types of debt accepted

  • Debt settlement programs and debt management plans are generally only options for unsecured debts, such as credit card debt

  • Debt consolidation and bankruptcy may be options for secured and unsecured debts

Accreditations

  • American Fair Credit Council

  • International Association of Professional Debt Arbitrators

Ratings

  • An excellent rating (five stars) on Trustpilot as of Nov. 26, 2018

  • A+ rating with the Better Business Bureau

Service limitations

Availability of services may depend on your state of residency

Free tools and resources

No

Customer service

Several reviews complain of poor, pushy or unresponsive customer service representatives. But most reviewers on Trustpilot say the service is polite, professional and helpful.

Who’s eligible?

  • To qualify for a service through Accredited Debt Relief, you must be:
    • At least 18
    • A legal resident of the United States
  • Eligibility for a specific program can vary depending on the program, service provider, type of debt you have and where you live.
  • Accredited Debt Relief is licensed and bonded in Idaho, Indiana, Iowa, Maryland, Minnesota, Missouri, Montana and Texas. It may be able to refer you to partners that offer debt consolidation loans in other states as well.

What are the benefits and risks of Accredited Debt Relief

Because Accredited Debt Relief can help you determine which program is best for your circumstances, it may be less risky than working with a debt relief company that only offers one service. Even so, consider the pros and cons of a particular program before enrolling.

Here are a few general benefits and risks to working with Accredited Debt Relief or trying one of the programs its partners offer:

Benefits

Risks

Accredited Debt Relief can connect you with a variety of service providers depending on your situation

Some options, such as debt settlement and bankruptcy, could hurt your credit

You may be able to settle your debt for less than you owe

If you stop making payments, you could wind up being sued by the creditor or debt collector

You can hire a company to negotiate with your creditors on your behalf

The fees you pay could extend your repayment time

With a debt settlement program, you won’t have to pay any fees until after your debts are settled

Accredited Debt Relief representatives are paid on commission and have a financial incentive to get you to enroll in a program

How much does Accredited Debt Relief cost?

The fees you’ll pay can vary depending on the program, service provider and where you live.

With debt settlement, you should only pay a fee once a debt is settled. The fee may be a percentage of the debt you enroll in the program or a percentage of your savings. If a company asks you to pay an upfront fee for a debt settlement program, that’s a red flag that the company isn’t trustworthy.

Accredited Debt Relief says, on average, clients pay about 50% of the balance they enroll in the program to their creditors. But the total cost is 68% to 75% of the total enrolled debt once you include the fees. It’s still a savings compared to paying the balance in full, but you may want to compare debt settlement companies’ fees to see if you can find a trustworthy company that offers a low fee.

Credit counseling organizations may charge you an enrollment fee and monthly fee for a debt management plan.

Debt consolidation might not have any ongoing fees, but some lenders could charge you an origination fee on your consolidation loan. The origination fee, which could be around 1% to 6% of the loan amount, may be taken out of your loan before the lender distributes the loan. Some lenders don’t charge an origination fee, although you may need good credit to qualify for a loan.

Even bankruptcy isn’t free. Costs can vary depending on where you live and the type of bankruptcy, but you may have to pay for court filing and credit counseling. Add on attorney’s fees, and you could wind up spending several thousand dollars.

How long does the program take?

Your timeline can also depend on which program is best for your circumstances.

For example, a debt settlement program could take 12 to 48 months to complete. During this time, you’ll generally stop making payments on your accounts. As a result, you may incur late payment fees. And those late payments could hurt your credit.

But you’ll start making monthly payments into an account that you set up with the help of the debt settlement company. Once you have enough money in the account to offer your creditor a settlement and cover the debt settlement company’s fee, the company will try to get a settlement agreement from your creditor. Accredited Debt Relief says, on average, clients will settle at least one account within the first three to five months. There’s no guarantee a creditor will settle your account, though, and you could be stuck owing the larger balance.

Other programs could take more or less time to complete. Loan consolidation can be a relatively quick process, as you’re simply applying for a loan and waiting for the lender to pay off your creditors. But a debt management plan might take three to five years to complete.

Is Accredited Debt Relief safe to use?

Accredited Debt Relief has many positive reviews from past customers and could be a safe place to start your search for a solution to your debt-related problems. But Accredited Debt Relief refers you to other companies (here’s a list of some partners), and you may want to vet each of those service providers before signing up.

How do I sign up for Accredited Debt Relief?

  • You can start the process by requesting a free consultation on Accredited Debt Relief’s website or calling 866-345-5007.
  • If you apply online, you’ll be asked how much debt you have and the state in which you live. You’ll also be asked for your name and contact information. By submitting your information, you agree that Accredited Debt Relief and its partners can call, text, email or mail you, even if you’re on a do-not-call list.
  • You’ll next be prompted to sign up to check your credit score. This isn’t part of the debt relief process. If you enroll in a credit score program, you’ll receive a free seven-day trial and then be charged a monthly fee. It may be best to skip this step as you can check and monitor your credit for free elsewhere. You can find an overview of the many companies that offer free credit scores on LendingTree, MagnifyMoney’s parent company.

What to expect after signing up with Accredited Debt Relief

  • The first step after signing up is to speak with a representative from Accredited Debt Relief. If you called Accredited Debt Relief, you may be connected with a representative right away. If you signed up online, a representative may call you to discuss your financial situation.

Alternative methods to pay down debt

Working with a debt relief company isn’t your only option for dealing with overwhelming debt. You may be able to put in place some of the same tactics that debt relief companies use but save money by taking a DIY approach. Or you may be better off trying a completely different tactic.

Debt consolidation

Debt consolidation is one of the services that Accredited Debt Relief offers, but it’s also something you can do on your own. Consolidation involves taking out a new loan to pay off your existing debts. Debt consolidation loans are often personal loans. But, in some cases, you may be better off opening a balance transfer credit card with a promotional 0% APR period and moving the debt to the card.

If you’re pursuing a personal loan for your debt consolidation, you may be able to compare offers using LendingTree’s debt consolidation loan tool. You’ll input some personal information before possibly getting matched with up to five different lenders.

Pros

  • Consolidating your loans can make it easier to manage your monthly payments.
  • You may be able to save money and pay off your loans sooner by lowering your interest rate.

Cons

  • It can be difficult to qualify for a large enough loan to consolidate your debts if you have a low income or poor credit.
  • You might not be able to qualify for a low-rate loan.
LendingTree
APR

5.99%
To
35.99%

Credit Req.

Minimum 500 FICO

Minimum Credit Score

Terms

24 to 60

months

Origination Fee

Varies

LendingTree is our parent company. LendingTree is unique in that you may be able to compare up to five personal loan offers within minutes. Everything is done online and you may be pre-qualified by lenders without impacting your credit score. LendingTree is not a lender.

Debt management plan

Accredited Debt Relief may refer you to a credit counseling company that offers debt management plans. Credit counseling organizations are often nonprofits, and you can check to see if the organization is accredited by the National Foundation for Credit Counseling (NFCC). You can also look for NFCC-accredited credit counseling organizations on your own and compare their debt management plans, pricing and reviews.

Pros

  • The credit counselor may be able to negotiate a lower interest rate and monthly payment for you.
  • You’ll be able to focus on making one monthly payment.
  • Creditors may waive some fees, such as late payment fees, if you start a debt management plan.
  • A debt management plan won’t hurt your credit. Unlike with a debt settlement program, you’ll continue to make your monthly payments.

Cons

  • There’s generally a startup fee and monthly fee for a debt management plan.
  • You may have to close your credit accounts.
  • A debt management plan likely won’t help with secured debts.
  • You won’t be able to settle your accounts for less than you owe.

DIY debt settlement

You can hire a company to negotiate a settlement on your behalf, or you could negotiate and settle debt accounts on your own. While a do-it-yourself approach could take more work and discipline, it may be a worthwhile use of your time.

Pros

  • Some creditors won’t work with debt settlement companies but may negotiate directly with borrowers.
  • You won’t have to pay the debt settlement company’s fee.
  • You might settle your debt sooner if you don’t have to save up money for fees.

Cons

  • Debt settlement companies may know from experience how low creditors will go, and could know when to accept a settlement or hold out for a lower offer.
  • Even a DIY approach could hurt your credit as you may have to stop making payments on your accounts before a creditor agrees to settle.

If you don’t stick to your plan, you might wind up hurting your credit and go deeper into debt due to fees and interest.

Bankruptcy

Chapter 7 and Chapter 13 bankruptcy are the two common types of personal bankruptcy that may be able to help you manage your debts. Chapter 7 bankruptcy could wipe away your unsecured debts, but you’ll also have to sell nonexempt possessions. You’ll be able to keep exempt property, which varies by state but may include a vehicle and some personal property. A Chapter 13 bankruptcy could restructure your debt and set you up with a more manageable monthly payment plan while allowing you to keep the personal property.

Pros

  • Once you file for bankruptcy, an automatic stay could keep creditors and collectors from garnishing your wages, repossessing property or shutting off your utilities.
  • You may be able to get some debts discharged even if you can’t afford to make a partial payment.
  • Collection agencies and creditors can’t continue to pursue you for discharged debts.

Cons

  • You may have to sell your assets and could even lose equity in a home or vehicle.
  • Declaring bankruptcy can hurt your credit scores, and the bankruptcy may remain on your credit reports for seven to 10 years.
  • You may not be able to get some of your debt or obligations, such as student loans or taxes, discharged during bankruptcy.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Louis DeNicola

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Source: https://www.magnifymoney.com/blog/pay-down-my-debt/accredited-debt-relief-review/

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