FAQs
Here are some typical questions we often hear:
- This sounds too good to be true. Does this really work?
- Is debt settlement legal?
- How does it work?
- What would I do to begin this process?
- What is the IRS position on debt that is forgiven?
- How does Debt Settlement affect my credit?
- What if I have a good payment history?
- When will I be debt free?
- Who controls the savings fund allocations to creditors?
- Couldn't I do these same negotiations on my own without paying a small fee to you?
- What is the difference between secured debt and unsecured debt?
- Is Debt Settlement Right for Me?
- What happens if I miss a payment to my trust account?
- Can I put more money into my trust account?
- Isn't debt settlement the same as debt consolidation or consumer credit counseling?
- Are there debts that cannot be included in the debt settlement program?
- Can you stop creditors from calling me?
- How do I get started?
This sounds too good to be true. Does this really work?
Debt settlement is a proven system. Working with experienced professionals, this system helps consumers:
- Settle for a percent of what is owed
- Find an alternative to bankruptcy
- We can negotiate your debt in a time frame that fits your personal situation
Is debt settlement legal?
Yes. It is legal to reach a settlement of any debt. We simply have taken a strategy that has historically been reserved for the wealthy and are now offering it to the public.
How does it work?
The process is amazingly simple:
- First, one of our experienced specialists helps determine which of your debts qualifies for this unique program.
- You agree to a monthly payment that you can afford into an account that will eventually be used to negotiate settlements with creditors. Settlement funds are distributed into a trust fund that you set up. As your account reaches specific amounts, we contact creditors to negotiate settlements, saving you substantially, at the time of settlement.
- Lump Sum Option: If you have access to a lump sum of money, we can immediately begin negotiations with your creditors. Clients who have a lump sum for this type of settlement typically receive the best outcomes.
What would I do to begin this process?
It's easy. Call 1-800-370-8918, or click here.
What is the IRS position on debt that is forgiven?
In most cases, clients can exclude forgiven debt from their income through the "insolvency exclusion" provided by the IRS code. This exclusion means that your liabilities exceed the fair market value of your assets. However, in the event that a forgiven debt amount exceeds $600.00, financial institutions sometimes provide a Form 1099-C. Even if you receive a Form 1099-C showing income in the form of canceled debt, this does not necessarily mean that you owe taxes on the forgiven portion of the debt. We highly recommend that you consult a tax advisor regarding your particular circumstances. If appropriate, your advisor will also be able to assist you in filling out Form 982 that excludes you from a particular debt.
How does Debt Settlement affect my credit?
Debt management intervention will impact your credit. Any time you stop paying your bills the creditors have the right to report your history as late or delinquent. However, the goal of debt settlement is to help you get into a positive cash flow situation in the quickest, least expensive means possible by negotiating reduced settlement amounts with your creditors. This will specifically address your main financial crisis -- debt.
What if I have a good payment history?
According to MyFico.com, your credit score is comprised of two main factors: your payment history and your debt-to-income ratio. Many people often mistake a good payment history with having good credit. However, if all of your monthly take home pay goes back out to paying bills, chances are you currently have a debt-to-income ratio that is already affecting your credit rating. If this is the case, your primary concern should be to immediately reduce your expense overhead.
How long will it take to settle my debt?
Every situation is unique. The time it takes to get through your individual program depends on several factors, and during your initial free consultation your debt specialist will be able to explain timing to you. Because our settlement process negotiates a reduction of your total principal balances, most of our clients are able to obtain agreeable settlements with all of their enrolled creditors in 36 months or less, in most cases. Plus, if your income or financial situation improves at any point, you always have the option of accelerating the program to resolve your unsecured debt even sooner.
Who controls the savings fund allocations to creditors?
You do. A savings account is set up by you and maintained by you. Our process helps you discipline yourself to add the required funds to the savings account during each month of the program. And remember, this amount is usually much less than the total minimum monthly payments you are now making on your credit cards. The more you put into the savings account, the faster you can accelerate your program.
Couldn't I do these same negotiations on my own without paying a small fee to you?
Yes, as long as you know how. Remember, though, that we are trained professionals who have years of experience in debt settlement. Our job is to get you settle your debt as quickly as possible.
What is the difference between secured debt and unsecured debt?
Unsecured Debt is any type of debt that is not secured by a TV, exercise equipment, car, etc. where the creditor could repossess these items in the event of non payment. This includes credit cards, hospital bills and personal loans among others.
Is Debt Settlement Right for Me?
Our specialists can help you determine if you are a candidate for this process.
What happens if I miss a payment to my trust account?
If something unexpected happens and you are in a pinch, it simply extends the process. However, our specialists are experienced in helping you determine a monthly amount that will realistically work with your existing income and help you deal with unexpected cash crunches.
Can I put more money into my trust account?
Sure, that just makes the process work faster and better.
Isn't debt settlement the same as debt consolidation or consumer credit counseling?
No. With credit counseling, you must pay back all of your debt plus interest. While they will reduce the interest, you still pay interest. With consumer credit counseling, you have to pay back 100% of what you owe. With debt negotiation, you pay back a fraction of what you owe.
Are there debts that cannot be included in the debt settlement program?
Yes. Typically we cannot negotiate tax debts, secured debts, alimony, child support, student loans, court restitution orders or criminal fines.
Can you stop creditors from calling me?
Some companies will tell you they can do that, but that is not accurate. Creditors have a legal right to communicate with you. If you request in writing that they discontinue calling you, they are still able to contact you in writing. The law does provide some protection for you, however, as collection agencies must abide by the Fair Debt Collection Act.
How do I get started?
Just call 1-800-370-8918, or click here.
Key Debt Services does not provide legal, tax or investment advice. If you need legal advice, legal expertise or court filings, you must seek the advice of a licensed attorney. Individual results may vary.
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