New Era Debt Solutions reviews are positive because the company helps people regain control of their lives. When debt exceeds a household’s ability to pay, families become constrained by it. I experienced the struggle of overwhelming debt after a job loss. Debt settlement allowed me to escape the debt cycle, so I could live my life to the fullest. In this article, I will detail the benefits of working with New Era Debt Solutions, as well as discussing the risks of debt settlement and providing examples.
What is New Era Debt Solutions?
New Era Debt Solutions is a debt-settlement company. A debt-settlement company works on behalf of clients by negotiating with their creditors. Through this negotiation process, an amount substantially lower than the full debt is agreed upon. This saves indebted families thousands of dollars in punishing interest and fees.
New Era works with debtors who owe over $7,000 in unsecured debt, with $30,000 as the average. Fees are 15 percent of the debt. The program takes 2-5 years and saves clients an average of 20 to 30 percent.
How It Works
As shown in New Era Debt Solutions reviews, the company represents its clients in creditor negotiations. These negotiations result in a legally binding agreement between the creditor and the debtor to settle the debt for less than the full amount owed. Once the agreement is made, the debtor is legally responsible for only the smaller amount. The creditor is barred from pursuing the debtor for monies beyond what is agreed in the settlement.
To qualify, debtors must have over $7,000 in unsecured debt. Secured debt, such as home mortgages and auto loans, is ineligible for the program. Debtors must have enough income to afford the settlement payments. Settlement payments are made on a monthly basis over the life of the debt-settlement program, which averages 2-5 years. As a rule of thumb, to afford the program, debtors need to budget for paying 1.5 percent of the total debt amount each month.
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A big advantage of working with New Era Debt Solutions is that there are no upfront fees. Clients pay nothing to New Era until the debt settlement occurs. This contingency-based fee structure ensures that clients never end up with more debt. Working with New Era, there is no way you will have to pay more in fees than you save. It always works to the client’s benefit.
Once you sign up with New Era, you pay approximately 1.5 percent of your debt amount into your settlement account each month. While funds are building in your account, your New Era advocate will contact your creditors and negotiate the settlement amount. Some creditors respond and make settlements quickly while others may take several months. Either way, you don’t need to worry. New Era will handle the creditors and pay them out of the settlement fund when an agreement is reached.
Benefits of Using New Era Debt Solutions
As many clients explain in New Era Debt Solutions reviews, the benefits of using New Era include the following:
- Saving money on debt repayments.
- Reduced interest rates.
- Reduced fees.
- One convenient monthly payment for all accounts included in the program.
- Freedom from collection calls.
- Stress reduction.
Owing more money than you can afford causes intense stress. The monthly bills keep coming. No matter how hard you work or try to economize, it just isn’t enough to make ends meet. Interest compounds, often causing debt to increase. When you work with New Era, this weight gets taken off your shoulders. You are no longer trapped by debt. All you have to do is make the one monthly payment.
Because the New Era settlement negotiators get your interest rates and overall balance reduced, you get out of debt much faster than you could on your own. This means you can start saving, instead of paying debt, much sooner. Settling your debt is the first crucial step towards building lasting financial security.
What Are the Risks?
There is no risk of owing more than you already do because there are no upfront fees; however, individual results do vary based on a number of circumstances. Here are some common risks that apply to all debt settlement plans, regardless of who handles the negotiation.
In rare cases, a creditor may refuse to negotiate. This happens infrequently because it is against the creditor’s interest. If this happens with one account, it is likely that all of your other accounts will be settled. The risk with a creditor’s refusal is having to handle that particular account outside of your settlement program.
The IRS considers forgiven debt a taxable event. For example, if you were to settle $10,000 of debt for $7,000, the IRS considers you to have $3,000 in taxable income. Working with New Era helps with tax liability because you pay over time and do not incur a big tax liability all at once.
As explained on Bankrate, your credit score may be affected negatively when you start a program. This occurs because you make no payments to creditors until a settlement is reached. When your accounts get behind by several months, your score will decline. It’s important to note that once you pay off the debt, you can expect your score to increase significantly.
I had over $15,000 in high-interest credit card debt with three creditors. Using round numbers, I owed Creditor A $5,000, Creditor B $8,000, and Creditor C $2,000. New Era settled my debt with Creditor A for $3,800, Creditor B for $5800, and Creditor C for $1,600. I paid off this debt at a rate I could afford, $180 per month. New Era also got my interest rates reduced. What a relief!
If you are overwhelmed by debt, debt settlement may be for you. It’s important to note that debt settlement differs from credit counseling. Credit counseling requires you to pay back the full amount, so there is no settlement. If your debt is very high and you just can’t afford to pay it back, debt settlement makes more sense.
Debt settlement often provides an alternative to bankruptcy. Because of this, many creditors are willing to negotiate. They are better off accepting the settlement than getting nothing.
Before filing bankruptcy or entering credit counseling, take a look at the New Era Debt Solutions reviews and website. For a free consultation with a debt settlement expert at New Era, call (800) 527-4421. Alternatively, complete the online form at www.neweradebtsolutions.com. You can also check out the company’s social media channels: Facebook, Twitter, YouTube, Google+.
New Era Debt Solutions reviews show that thousands of customers have gotten out of debt through its debt-settlement services. The process is easy and can be started with a free consultation. For people with unmanageable debt who want to avoid bankruptcy, New Era Debt Solutions provides the answer. To learn more, check out New Era Debt Solutions reviews online. Users should feel free to spread the word about New Era Debt Solutions by sharing their experiences, thoughts, and questions.