Debt relief — also known as debt settlement — offers borrowers with more debt than they can feasibly pay back due to financial hardship a potential way to square up what they owe without having to repay the full balances.
How is this possible? This approach involves negotiation with creditors — and using past and/or present missed payments as leverage. While you want to avoid defaulting altogether on your loans or applying for bankruptcy, your creditors also want to avoid these outcomes because it means they will not get any repayment. So, they just might be willing to accept a reduced payment if you can prove you’re able to transfer the funds on an accelerated timeline.
Debt settlement programs exist to walk clients through the steps of this process, including requiring them to make monthly deposits into a special account ahead of negotiations. This helps participants save up the money necessary to hopefully strike a bargain with creditors.
There are many debt relief companies out there today, each with its own requirements. Although there are laws in place to regulate the industry, there are slight differences between different programs — and, frankly, some companies are stronger than others.
One company you may have encountered while doing research is Credit Associates. Is this a good company through which to pursue debt settlement? What should you know before enrolling in this program?
What the Reviews Say About Credit Associates
As with any financial company, Credit Associates seems to have its strengths and weaknesses. Some clients have found success through this program; others have encountered difficulties along the way and have complaints as a result. Looking at third-party reviews that cover both the negative and positive aspects of working with a certain debt relief company is a great way to get a feel for what to expect.
The Balance rates Credit Associates just short of 3 out of 5 stars — 2.9 to be exact. Some of the highlights are the portal enrollees can use to log in and check on their progress whenever it is most convenient for them, as well as the relatively accessible customer service team available six days per week. Some of the drawbacks listed in this review are the lack of transparency about how much the company charges in fees and the fact that it only works with borrowers in certain states.
The Credit Associates reviews from Bills.com give this company 4 out of 5 stars, noting its legitimacy — as demonstrated by its track record of nearly 15 years and its accreditation by industry watchdogs. Again, this review notes the lack of clarity about exactly how much participants will have to pay in fees for any debts successfully settled. An industry-typical fee is around 15 to 20 percent, but it’s very important to know this figure ahead of time before signing up for any program.
Credit Associates Accreditation: Why It Matters
One thing Credit Associates has going for it is its accreditation by the American Fair Credit Council (AFCC). To become a member, debt settlement companies must agree to adhere to best practices meant to protect consumers against fraud and mistreatment — as well as pass audits designed to make sure these member organizations are practicing these standards.
A major hallmark of AFCC members is that they never charge advanced fees. Fees are only collected after a debt has been resolved. Whether you end up choosing Credit Associates or another firm, it’s smart to shop from the AFCC list so you know the company is operating fair and square.
Credit Associates seems to be a solid option for debt settlement in many regards, including its accreditation and its convenient online portal. However, some other companies rank higher. Be sure to compare all your options before deciding on a debt relief program.