Debt Burst FAQs

Debt Management Services Questions

• Q: What is Debt Management?
  • A: Debt management is the program that consolidates your credit card debt into one monthly payment, which is sent directly to your creditors by a credit counseling agency, in this case by our credit card agency.  A debt management program is one of the many options that a debt specialist might suggest when you’re having issues with credit card debt.
• Q: How does Debt Management work?
  • A: During a debt management session, a specialist will ask you questions about your current bills. After providing a free budget and debt analysis, they’ll help identify which debts you can consolidate under a debt management program.
    There are some restrictions imposed by your creditors when you enter a debt management program, so our qualified specialist will make you aware of these before signing up for the program.
• Q: How will the Debt Management Program affect my credit report?
  • Depending on your personal situation, participating in a Debt Management Plan (DMP) could have a positive effect on your credit rating. Those who are in need of a plan will benefit by consistently making their monthly payments. This step alone will help you avoid negative marks on your credit report.
  • If your credit report already shows any late or missed payments, then our program will more than likely enhance your record because of our on-time, single monthly payment method. Also, if you continue to make all your payments on-time, creditors may be willing to bring your account current—good faith. Once you have paid off all your debts and have finished with the plan, it will be easier to reestablish your credit and stay financially healthy and debt-free.
• Q: Do you loan the money?
  • A: No, Debt Burst is not a lending institution. We work with creditors on your behalf to establish an affordable new payment arrangement, which may include benefits such as a reduced interest rate and stopping late or over-limit fees, allowing you to pay off your debt more quickly. We collect one monthly payment from you and disburse your payments to your respective creditors.
• Q: When can I expect to pay off my debt?
  • A: Each plan is customized to fit the client’s financial situation. Depending on the amount of debt and your income, that will determine your monthly payment plan and when you can expect to pay-off all your debt. If timing is important to you, we can create a couple of plans for you to review so that you may choose the best plan that works for you. If you’re able to put more money into the plan, then you can decrease your timing to pay-off your debt.
• Q: How does a Debt Management Program differ from the Debt Settlement Plan?
  • A: Debt Management is paying off your total debt amount owed to your creditors where Debt Settlement is only paying off an agreed upon percentage of your total debt amount owed to your creditors. Creditors are willing negotiate because they desire to collect some payment rather than nothing if you were considering bankruptcy.
• Q: Who qualifies for the program?
  • A: In order to qualify for any debt management program you must have some form of financial hardship. Below is a list of valid financial hardships.
    Reduced Income
    Unemployment
    Divorce
    Medical
    Disabled
    Overspending
    Poor Money Management
    Gambling
    Addiction/Psychiatric Issues
    
  • No matter what your income or situation is, if your expenses exceed your take home pay and you are currently struggling to make ends meet it is time to speak with a debt settlement specialist to start laying out some options that may be available to you.
• Q:  Is my personal information kept private?
  • A:  Yes, we up-hold the strictness privacy policies when dealing with your personal finances and personal information. No information is shared with anyone outside of the company
• Q: Can I settle my own debt?
  • A:  Yes, but we highly recommend you consider a debt relief program because we are specialist in dealing with creditors and have been very successful in negotiating good deals for our clients.
• Q: How do I know when creditors are paid?
  • A: You will receive a monthly statement which shows how much is paid to each of your creditors and what amount of debt is left to be paid.
• Q: What is the difference between secure and unsecured debt?
  • A: A secured debt is a debt secured against an asset that you own. Typical secured debts will be a mortgage, a secured loan, a car loan, etc. An unsecured debt is any debt not secured on an asset, such as a bank overdraft, a personal loan, a credit card, store card, etc.
• Q: Can I use my credit cards while in the debt management plan?
  • A: NO.  All credit cards in the program will not be active and you will not have credit privileges.  Any cards you DO NOT put into the program should not be used.  This program is designed for you to get out of debt.
• Q: What happens if my financial situation changes?
  • A: Let your counselor or specialists know immediately so that we can review your current situation and implement more savings
• Q: Will most creditors accept debt management programs?
  • A: Yes, because they are eager to collect money for this debt in a professional matter so they enlist other companies to collect debt for them. They also desire to work with clients and will normally workout deals if you’re willing to pay them.

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Debt Settlement Services Questions

• Q: Who is qualified for this program?
  • A: In order to qualify for any debt settlement program you must have some form of financial hardship. Below is a list of valid financial hardships:
    Reduced Income
    Unemployment
    Divorce
    Medical
    Disabled
    Overspending
    Poor Money Management
    Gambling
    Addiction/Psychiatric Issues
  • No matter what your income or situation is, if your expenses exceed your take home pay and you are currently struggling to make ends meet; it is time to speak with a certified debt settlement specialist to start laying out some options that may be available to you.
  • You DO NOT have to be late on your payments in order to get advice or to join a debt relief program. Before the thought of bankruptcy is even considered, you need to take the time to speak with a debt settlement specialist to see what types of programs are available to you and what truly makes the most sense for you financially. Our Debt Settlement programs may reduce your interest rates and monthly payments that will allow you to get out of debt in a reasonable time frame without having the detrimental effects when filing for bankruptcy.
• Q: Who is NOT qualified for the program?
  • A: The program does not advocate that any person default on their debts.  This program is not designed to negotiate debts for people who have reasonable means to pay off their debts.  If you have the ability to pay our debts in the normal fashion, by paying minimum payments, then you should honor your debts and do so.  This program is NOT for people who are gainfully employed, have high credit ratings and can meet their monthly debt obligations.
• Q: How do you apply?
  • A: Complete the form online.  A debt specialist will review your information and call you to review your situation.  After a debt specialist has reviewed your financial situation, hardship they will determine if you are qualified for our program.
• Q: Is bankruptcy a better option for me?
  • A: Anyone considering our program should also contact a bankruptcy attorney to determine if his or her situation warrants filing for bankruptcy.  Using the Debt Settlement process does not guarantee that you will not have to file for bankruptcy in the future.
• Q: Does Debt Settlement have a negative impact on my credit?
  • A: YES.  Your credit score will decline due to entering this program.  How much it will decline depends on your original circumstances.  Most of the accounts you place into negotiation are likely to “charge off”, which will reflect negatively on your credit.  However, once this charged off debt is settled, the settlement is reported to the credit bureaus.  Settled accounts are positive compared to unresolved delinquent debts or bankruptcy.  After all the debts have been settled and paid, the credit score should begin to improve since the negative items have been resolved.  A high credit score is desirable to have, but if you have a financial hardship and are unable to pay your debts, then your first priority should be to pay your delinquent debts and get back on your feet financially.
• Q: Can I still use my credit cards?
  • A: NO.  All credit cards in the program will not be active and you will not have credit privileges.  Any cards you DO NOT put into the program should not be used.  This program is designed for you to get out of debt.
• Q: What will I pay for your services?
  • A: This program has a 12.5 % fee, which is calculated based on the total amount of debt that an individual brings into the debt settlement program.  This program requires one or two down payments then small monthly fees paid throughout the first year of the program.  All cost and fees are always fully disclosed and you are required to sign for approval before you commit to our program.
• Q: Can I be sued?
  • A: YES.  Your creditors certainly have the right to sue to recover their money.  But usually the purpose of the lawsuit is to force a settlement on the matter.  In our experience, most creditors would rather not go to the expense of suing and simply try to negotiate a settlement.
• Q: Can creditors garnish my wages?
  • A: Yes, however this can be a long process for the creditors.  The creditor first has to sue you, successfully obtain a judgment, and then file for a garnishment action.  If you’re willing to work with your creditors, wage garnishment can normally be avoided.
• Q: What are the tax consequences?
  • A: Your creditors will report cancelled/settled debts exceeding $600 to the IRS and you are required to report the same as income on your annual tax return.  However, the IRS permits you to write off any “income” from cancelled debts up to the amount by which you were “insolvent” at the time.  You need to consult your own tax advisor for advice specific to your situation.
• Q: What if I cannot afford to pay the fee?
  • A: If you can afford to make the monthly payments, you can afford to pay the fees.  All fees are built into the program and are included in your payments.  Simply make your monthly and all the fees will also be paid.
• Q: Why shouldn’t I just file bankruptcy?
  • A: Many people faced with financial hardship rush to bankruptcy as a method of resolving their debt concerns, although their problems might have had other solutions.  We believe bankruptcy should ONLY be used as a LAST RESORT; pursued ONLY after all other debt relief remedies have been explored.  A bankruptcy filing is a very detrimental entry on your credit history, and can remain on your credit reports from 7 to 10 years after the bankruptcy filing has been discharged.
• Q: I want to get a loan instead?
  • A: Borrowing more money is not going to help you.  Please understand that you’re in a high-risk category and the higher the risk for bank, the higher the rate for you.  Remember, you want to get out of debt not deeper in.  Plus, if you could get a loan, the lender would most likely want it to be secured by your home or other assets.  If you then defaulted, you would lose whatever precious assets you currently have.
• Q: When will the negotiation process start?
  • A: As sufficient funds accumulate in your Settlement Deposit Account, settlement offers are submitted to your creditors.  Therefore, “starting negotiations” is completely dependent on the available funds in your Settlement Deposit Account.
• Q: Do I need to consolidate all accounts in the program?
  • A: With debt settlement you can choose which accounts you want to include.  You should be aware that some accounts left out of the program might be closed if the creditors discover that you are in debt settlement.
• Q: When can I expect to pay off my debt?
  • A: Typical programs are settled within 12 – 36 months but it depends on your situation

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Consumer Benefits Program Questions

• Q: Who can sign-up for the program?
  • A:  Anyone who desires to save money but there are no restrictions. Please contact Debt Burst to learn how you can sign-up and start saving instantly!
• Q: Does it take long to sign up?
  • A: No, we can take your information and get you signed up immediately. You will be assigned your personal membership number and asked to fill out a login and password for online access to the system. Once logged in, you start saving. There is no wait period or long paperwork.
• Q: How do I participate in the program?
  • A: Once signed up with the program, you will be given a login and password. There is an interactive and easy to use portal where you can view discounts, changes, download and print coupons, manage your account, make reservations and appointments, view special promotions and take advantage of medical, dental and vision benefits
• Q: How are discount applied?
  • A: Clients can print out online coupons, use their membership card when traveling or dealing with approved vendors or use promo codes provided on the Consumer Benefits web portal
• Q: Just how much can I save with the Consumer Benefits Program?
  • A: Most members have saved over $3000 annually and sometimes even more. Once you’re a member, visit the saving calculator to find out just how much you can save.
• Q: Who do I contact if my membership is not working?
  • A: Contact Debt Burst and one of our friendly representatives will gladly settle this issue and get you up and running quickly
• Q: Who do I contact if I can’t print a coupon or redeem a discount?
  • A: Contact the Consumers Benefits hotline that will be accessible once you logon to the system. There are help and contact us buttons that will supply you with the numbers you need. Help is available 24 hours and 7 days a week
• Q: If I want to cancel, what do I do?
  • A: You can cancel at anytime by calling Debt Burst; however, we recommend you remain a member and participate in discounts in everything you use. You never know when you could use a discount or need to make a last minute trip where you could save over $100 on your entire trip. You family members can also take advantage of this program so it’s a win-win situation. Stay in the program and enjoy the benefits of it.

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