Searching for a solution to overwhelming debt? You should have a clear understanding of the available options. National Debt Relief has emerged as a popular choice for many. For some consumers, bankruptcy may wipe out debts faster, but that approach also has inherent risks.
Who is National Debt Relief?
National Debt Relief (NDR) is a New York-based debt settlement company founded in 2009. With an A+ rating from the Better Business Bureau and a strong reputation in the industry, they have assisted numerous clients in their journey towards financial freedom, negotiating with creditors to lower the debts owed by consumers. Given the differences in local regulations, National doesn’t offer its services in these states: Connecticut, Oregon, Vermont and West Virginia.
National Debt Relief
Pros and Cons
- Potential to reduce overall debt significantly.
- One monthly payment, often lower than combined minimum payments on individual debts.
- Expert negotiators handle communications with creditors.
- Credit score may be negatively impacted during the process.
- There’s no guarantee that all debts will be settled.
- Potential tax implications on forgiven debt.
Services Offered by National Debt Relief
NDR specializes in debt settlement services. Their primary goal is to negotiate with creditors on behalf of their clients to reduce the overall debt owed. The service is ideal for people with significant amounts of unsecured debt, such as credit card debt, personal loans, and medical bills. On average, consumers who complete the National Debt Relief program save 23%, taking into account the company’s fees.
Customer Qualifications or Eligibility to Work with NDR
To qualify for NDR’s services, a potential client typically needs to have at least $7,500 in unsecured debts. The company’s services are best suited for individuals struggling to make minimum monthly payments and are at risk of default.
Average Amount of National Debt Relief Client Debt
While the minimum debt requirement is $7,500, many clients that approach NDR often have considerably more debt. The average debt amount for their clients can range anywhere from $20,000 to $100,000.
What National Debt Relief Services Won’t Cover
They do not handle:
Federal student loans or other government-backed debts
How National Debt Relief Consolidation Works
Contrary to popular belief, NDR does not offer debt consolidation loans. Instead, their approach involves negotiating with creditors to accept a settlement that is lower than the full amount owed. Clients make monthly deposits into a dedicated escrow account, which NDR then uses to pay off the negotiated settlements over time.
As part of the process, you cease making payments to your creditors and become delinquent on your accounts. As the late fees and additional interest racks up, your credit score tumbles.
National negotiates with creditors on your behalf. Because you’re delinquent, creditors often view getting a reduced amount as better than getting nothing at all.
Cost or Fees for National Debt Relief’s Work
NDR charges fees based on the amount of debt enrolled and the state of residence. On average, their fees range from 15% to 25% of the total debt. These fees are only charged once a debt is successfully settled.
Customer Timeline when Working with NDR
The debt settlement process with NDR usually takes 24 to 48 months. The timeline is influenced by the total debt amount, the monthly deposit amount, and the willingness of creditors to negotiate. During the application process, National Debt Relief does a soft credit pull to verify creditors and outstanding balances owed on each debt. A soft credit pull does not affect your credit score.
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