Bankruptcy - Credit Card Debt - Background Information From Pacific Debt

Frequently Asked Questions

1) What type of debts do you handle?
2) What effect will debt negotiation have on my credit rating?
3) How does this compare to consumer credit counseling?
4) Is your service the same as debt consolidation?
5) How long does this take?
6) Can you stop creditor harassment?
7) Can you stop creditor calls?
8) How much can the program save me?
9) Why shouldn't I just file Bankruptcy?
10) Why should I use Pacific Debt?
11) I'm interested in hiring your company. What's the next step?

What type of debts do you handle?
All “unsecured” debt, or debt not secured with collateral, is allowable in our program. These debts include credit cards, medical and legal bills, judgments, unsecured or personal loans of any type, retail debt, debt owed after repossession, and accounts in collections.

What effect will debt negotiation have on my credit rating?
PDI is committed to your overall financial well-being. We understand your credit rating is important. Initially, most people who enter a debt negotiation program will not have a good credit rating to begin with and it will get worse while you are on the program. If you enter our program with a high credit score (over 680), then the near term impact on your credit score may be more severe. However, once on the program, you should be in a better financial position to establish a good monthly payment track record with your secured debts, such as your car loans, mortgages, student loans, etc. Maintaining a timely payment history on these debts will be viewed as positive on your credit history.

Upon completion of the program, your overall financial situation should be dramatically improved even though your credit rating may not be good. Additionally, you will have significantly improved your debt-to-income ratio, a key barometer lenders look at when measuring your total financial health.

If you manage your credit wisely as well as pay your secured debts in a timely fashion each month, your credit score will rebound in the long run. Remember, bankruptcy is on your credit report for up to 10 years and will remain in court records forever. The average time* of completion for debt negotiation program is only 24 to 48 months and some people finish in less than two years.

*Based on individual circumstances

How does this compare to consumer credit counseling?
Consumer credit counseling has no effect on your debt principal at all. Their purpose is to get you to pay the debt in full by obtaining a lower interest rate. The major problems with credit counseling are that the monthly payments are often too high, and that it may still take at least five or six years to pay the debt off. You should also know that these firms were established by the creditors! What it comes down to is that Pacific Debt will work for you, while the consumer credit counseling firms work primarily for the creditors!

Is your service the same as debt consolidation?
No. With our debt negotiation program, we negotiate on your behalf to reduce the amount you pay to your creditors. Debt consolidation requires you to apply for and obtain a new loan in order to pay off the entire amount of your existing debt. If you have too much debt and/or bad credit, it is unlikely that you would be approved for a consolidation loan. (Read Your Options)

How long does this take?
Our goal is to have you debt free in 24-48 months, depending on your current situation. Our experienced negotiators will work with you and your creditors to settle your debts for as little as possible, with a target of debt reduction of around 40-50 cents on the dollar. During the negotiation process, creditors may continue to charge interest, tack on late fees or other charges; however, we factor this in to your overall program and estimate. The time it takes to clear a debt is mainly dependent on your financial condition, but may also depend on the creditors you enroll. We understand that every situation is different and we can discuss your situation during the free confidential phone consultation.

Can you stop creditor harassment?
We work with you to help manage and reduce the harassment in an attempt to allow you to get back to the life you deserve. One of the main reasons people consider bankruptcy is the constant harassment from collectors. Once started on the program, depending on the creditor accounts enrolled and circumstances of your situation, we will send out letters to your creditors and request that they only contact us, not you. We will also tell you how to minimize your phone conversations with creditors and educate you on you rights under the Fair Debt Collection Practices Act.

Can you stop creditor calls?
There are times that creditors may call you at work or at home. If these calls are bothering you and you would like help reducing them, call us. We will deal directly with your creditors to help reduce or eliminate the bothersome creditor calls.

How much can the program save me?
Our goal is to save our clients as much money as possible. In fact, a large percentage of our compensation is tied directly to the results we achieve for you, thus our negotiators have a financial incentive to save you as much as possible. Our program will generally have you debt free for less than what you owe now and potentially save you thousands of dollars in future interest.

Why shouldn't I just file Bankruptcy?
Bankruptcy is an extreme option, which has serious long-term effects on your credit and can often have negative results in many aspects of your everyday life. Bankruptcy is considered only as a last-resort option for just a few of the following reasons:

Filing for bankruptcy will require you to appear in Federal Court at least once and in most cases, even more.
Bankruptcy paperwork requires that you reveal all of your debts as well as all of your assets.
For up to ten years, credit bureaus are entitled to keep your bankruptcy filing on your credit report.
A bankruptcy filing is also a matter of “public record” for anyone that wants to know about it.

Why should I use Pacific Debt?
Most importantly, Pacific Debt is not paid by other companies when helping clients to reduce their debt. We stay profitable as an organization based on a percentage of the debt we eliminate. Thus it is in our best interest to save you every penny we possibly can! It is up to you take the first step and call.

I'm interested in hiring your company. What's the next step?
The first step in becoming debt free is to have a free phone consultation with us. Give us a call today and we can discuss your situation at greater length. At this time, we will determine if you qualify and if our program would be suitable for you.

Call 1-877-PAC-DEBT Today!

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