Freedom Debt Relief vs ClearOne Advantage

Debt relief can come in two main forms: debt settlement or debt consolidation. 

With debt settlement, you work with a debt relief company that negotiates with your creditors on your behalf to settle your debts for less than you owe. You then pay the debt relief company settlement fees, and pay off your debt once a settlement amount has been agreed upon.

With debt consolidation, you receive a loan from a debt consolidation loan company that allows you to pay off your existing debt. Then, because of your loan, you are now in debt to the loan company, but you can now focus all of your energy to pay off that loan, rather than paying off multiple creditors at once. 

This option does not reduce the total amount of debt you owe, but rather just consolidates it in one place so that it is easier to keep track of.

Freedom Debt Relief doesn't charge an upfront fee or any other fees until after debt is settled with creditors. This practice is standard for the industry. Debt relief companies, like National Debt Relief and Pacific Debt, also do not have upfront fees.

Upon enrollment, customers will open an FDIC-insured bank account that the client controls. Clients will put all of their money that would have gone toward paying their debt into this bank account instead. This is the main reason why this program hurts your credit score more than debt consolidation.

Next, FDR or its representatives or agents will negotiate with your creditors to settle on debt to pay.

Freedom Debt Relief makes money by charging fees on the enrolled debt amount. Its average fees are a bit high (around 22 percent fees on enrolled debt), but its services are thorough.

The company's ability to help clients find an easier road to financial freedom and paying off debt is highly valuable.

Personal Debt Settlement Consultant

ClearOne Advantage understands that one customer's financial situation will be entirely different than another.

Because each customer can have any number of unsecured debt problems (credit card debt, medical debt, student loans, etc.), ClearOne Advantage assigns one debt settlement consultant to each customer.

Customers won't have to worry about explaining their situation to different consultants every time they ask for an evaluation or progress report. Additionally, assigned consultants are much more likely to be invested in your financial relief options and concerns than a complete stranger to your case.

Debt Settlement Process

Debt settlement clients choose to stop making any monthly payment on their debts. Instead, they deposit money into a separate bank account to be used to pay settlements with each creditor.

The debt settlement company will negotiate with each creditor to reduce the total amount of debt clients owe. Debt settlement companies do not charge until all of the enrolled debt has been settled with each creditor.

Because debt settlement clients stop making monthly payments, their credit score drops. This can have some short-term consequences, so you should have a plan to rebuild your credit before having a company settle your debt.

It's also worth noting that settled debt is marked as settled on your credit report. When looking at your credit report, people can see that you did not pay all of your debts in full.

While there are risks and disadvantages when choosing a debt settlement program, it can be a better alternative than bankruptcy.