Freedom Debt Relief assists clients in negotiating and settling unsecured debt, including credit card, medical, and personal loan debts. The company can also assist with medical debt and personal loan obligations.
This program may not be free and it could harm your credit score; however, they claim to save consumers money and damage their scores less than bankruptcy would. They charge a fee between 15% to 25% of debt enrolled.
The process
Freedom Debt Relief’s process for debt relief begins with an assessment and consultation to assess eligibility. Once enrolled, monthly deposits into an account owned and controlled by you instead of creditors is made instead; this provides leverage with creditors by refusing payments until they accept new terms; during this time your credit may take a hit from missed payments and late fees accruing but it may be the best way to convince creditors to accept less than what is owed to them.
Once enough money has accumulated in your account, FDR will negotiate on your behalf with each creditor to reduce debt payments to less than what they owe and devise a savings plan that fits within your budget. They warn however, that it could take four or six years due to creditors taking months to agree on new terms – which could eventually lead to your accounts being sold off to third party collectors and harm your credit rating further.
Even though bankruptcy can damage your credit, debt relief programs may still be necessary in many instances. They’re more cost-effective than bankruptcy while helping people overcome overwhelming debt loads more effectively. Before choosing one of these plans, however, do your research thoroughly and ensure you’re working with a trustworthy organization with experience helping people like yourself recover financially.
Freedom Debt Relief stands out as a top debt resolution company with an outstanding track record and is fully accredited by the AFCC. Customers love Freedom Debt Relief’s service and frequently recommend it to others; furthermore, Freedom Debt Relief offers both a money-back guarantee and free consultation to reduce any concerns you might have about its services.
The fees
Freedom Debt Relief does not come cheap. They typically charge 18-25% of all debt enrolled when negotiating with creditors on specific accounts and present clients with settlement offers which they have the ability to accept or decline.
After settlement negotiations have taken place, clients typically receive an amount equal to or less than their original balance, and creditors report it as being paid in full on consumer’s credit reports. It is therefore imperative that sufficient funds are held in your escrow account in order to cover the costs of settlement negotiations.
If this proves too difficult for you, legal representation may be necessary – although this service is optional – in order to safeguard your rights and ensure they are respected throughout the process.
Debt relief services often have a damaging effect on your credit score, due to you voluntarily choosing not to make payments on credit card and other debts that accrue interest and accrue late fees, leading to missed payments that show up on your credit report and cause it to drop drastically.
Debt settlement companies will only begin negotiations with creditors once you have enough saved in an escrow account – this makes having a reliable savings plan essential before enrolling in any debt relief programs.
One advantage of Freedom Debt Relief is their free consultation service that will evaluate your situation to see if it meets their debt relief program’s criteria, provide an estimate of costs involved and open a dedicated account where monthly payments can be deposited; they’ll notify you once they have negotiated a debt settlement with one or more creditors that meets your approval and transfer these payments directly from that account to them in order to pay off debts.
The company’s reputation
Freedom Debt Relief offers a debt relief service that works to negotiate with creditors on your behalf to reduce what you owe. Their clients must owe at least $10,000 and they have received an A+ rating from Better Business Bureau as well as 4.9 out of 5 star reviews on Trustpilot. In addition, Freedom Debt Relief also offers free debt consultation where they discuss your personal debt situation and devise a plan to help get out of it faster.
This program usually lasts four to six months and involves you discontinuing payments on accounts that have become delinquent, including negative effects on your credit score and collection calls from debt collectors. But this delinquency is necessary in order to bring debt under control – the company promises that they will keep you informed as to the status of each account and encourage direct communication between you and creditors through its online dashboard.
Debt consolidation services typically work with unsecured debt such as credit card, department store credit and personal loan debt; however, they do not help with secured debt such as car or home loans secured with collateral such as cars or homes. Furthermore, student loan consolidation does not apply, though private lenders might assist in negotiating debt settlement for medical debt.
As part of this program, you will deposit money into a separate account that will be used solely to pay off debt. When the company negotiates debt settlement agreements with creditors, you will be notified immediately and must approve before your funds can be spent on paying it off. Once completed, no longer responsible for this debt and it will be removed from your credit report.
Though debt settlement services can save money, their fees may compromise any savings you achieve and cannot guarantee to settle your debt for a specific amount.
Furthermore, bankruptcy is an expensive and complex option that may significantly damage your credit. Although typically considered an ultimate solution for debt issues, bankruptcy could help if other options prove ineffective.
The final verdict
Freedom Debt Relief is a highly resourceful debt settlement company offering non-traditional programs for consumers with high amounts of unsecured debt, such as credit card bills or medical bills. Consumers in distress can turn to Freedom Debt Relief to negotiate settlements with creditors for less than what they owe – accredited by the Better Business Bureau with strong reviews on Trustpilot and an accreditation from both organizations – though some individuals have left negative reviews; furthermore they were sued by Consumer Financial Protection Bureau in 2017 which they settled out in 2019 by agreeing to change some practices in practice at this company.