Did you receive a mailer from CreditAssociates titled that you are pre-approved a lower monthly payment? Does it say that it's your "Final Notice"?
Are you skeptical because the monthly payment CreditAssociates is mentioning feels too good to be true? So what exactly is CreditAssociates? Is it legitimate?
CreditAssociates pitches a product called debt settlement (also known as debt relief and debt consolidation programs). If you are not familiar, Debt settlement is the process in which a third party negotiates with your creditor on your behalf. The goal of a debt settlement firm is to negotiate a lower balance from say $10,000 to $5,000 to provide you debt relief. I was the previous CEO of a debt settlement company, and I know that debt settlement may be a good option, but it also may not be compared to other options.
According to BBB, CreditAssociates has been a company since 2016, and is headquartered in Dallas, TX. The company focuses primarily on credit card debt settlement. According to its website, it has helped thousands of its customers settle millions of dollars in debt. CreditAssociates offer free financial consultation to prospective clients. This consultation is aimed at discussing qualifications to become their client. Once they draft your savings plan, you can ruminate on it, and decide if you’re willing to work with them. One criterion to fulfill before they can handle your debt is to have a minimum of $10,000 in debt. Another salient criterion is to demonstrate capacity and willingness for regular debt payments. If you meet their criteria and are qualified to enroll, the company immediately initiates the negotiation process. It will then coordinate the debt settlement process.
The length of its debt settlement company depends on each consumer’s financial predicament. However, it claims to get the job done within 24 to 36 months of initiating a debt settlement plan. Although the company’s primary area of focus is credit card debt, it also assists in personal loans. It can’t help to reduce secured debt like vehicle loans, home equity loans, or mortgage loans since it only provides debt settlement.
At Ascend, we believe that debt settlement may be a good option, but it’s only in the context of understanding all of your options and understanding the cost of that option. This is exactly why we built a free debt relief cost comparison calculator so that you are MOST informed. It will also allow you to compare the cost of debt settlement to debt management, debt payoff planning and bankruptcy.
Having a holistic and objective review of a debt relief agency can be difficult. Quite often, the company contracts writers to put up favorable reviews about their service. And in extreme cases, competitors hire people to put up damaging reviews about competitors.
To help you have the right perception of what consumers truly think, we’ll discuss reviews from 5 reputable platforms. Let’s go:
CreditAssociates has an average rating of 1.56 on BBB, based on 27 reviews. That said, it still does maintain an A+ rating, so I am not exactly sure how the rating system is setup on BBB. CreditAssociates also has 37 complaints in the last 12 months and 97 complaints in the last 3 years based on the time of this writing.
The reviews on Consumer Affairs the company’s debt relief process is outrightly straightforward. The details of their agreement are easy to understand, even without legal help. Consumers just have to hand over some specific information, the team then carries out its initial analysis and decides whether they can help. They’ll also communicate the price to you beforehand.
The company’s representative also explains how it works, and how they’re the best fit for the negotiation process.
However, its reviews on Consumer Affairs are not all positive. A major complaint from consumers leaving 2 -3 star reviews is that the negotiation process takes too long.
At the time of writing this article, CreditAssociates has an overall rating score of 4.3 on Consumer Affairs. This is based on the 360 reviews it has gotten from verified buyers.
Overall, CreditAssociates has an average review of 3.1 on Google. The total number of reviews it has on the platform is 53.
CreditAssociates reviews on Google fall on both extreme sides. Nearly half of the reviews gave them five stars, while the other half settled for one star. Only a few seem to be in the middle.
The strong point for those praising the company is its ability to resolve the debt. A particular user mentioned how it has helped in getting rid of half of its debt. The reviews claimed the representatives are very polite, and they take the time to explain how things work.
For the poor reviews, CreditAssociates were majorly scolded for being too costly. An unhappy past client noted that although the company helped settle a debt well below what she owed. But she paid a hefty price–equal to a quarter of original debt. Order debtors whose payments were in the negotiating process also filed lawsuits against her. The debtor warns order users to be careful of the company.
CreditAssociates has a rating of 2.9 on The Balance. The platform shares its opinion on the debt relief company.
The balance noted that although Credit Associates is certified by major industry associations, it’s still shady in its dealings. They noted that they’re not fully transparent about what’s going on, and their communication is not ideal. As such, they suggest considering other options.
The balance also noted that Credit Associates has some pros. These pros include the fact that they’re accredited by IAPDA and AFFCC. They also offer support every day, except Sunday, and they have a client portal where you can monitor your account.
Some cons highlighted by The Balance is that services aren’t available in all states. Their fees are sometimes not fully disclosed, and only individuals in hardship can qualify.
Credit Associates only has a total of 5 reviews on Yelp. Those reviews gave it an average of 1.5 stars. The best review it got was a single 3 star, and the reviewer laid bare his experience.
The customer believes that the company is legit, however, their service just didn’t work for him. He advised that consumers do thorough research, and ask the company necessary questions.
He noted three red flags with this company. The first is that they don’t initiate negotiation till they believe you have enough funds for a lump sum.
The other one is that your account has to fall delinquent, making your credit score really bad. Another demerit highlighted is that it’s not all creditors that work with them.
Credit Associates has a total of 326 reviews on Best Company. Platform users rate it 4.4, out of which 66% is a 5-star rating.
In one of their 5-star reviews, the user says they’ll save her over 5 grand, concluding that they’re trustworthy. She further reiterated that they only require information to pursue a settlement. She praises their communication, especially their ability to work her through and inform her of every step.
When you sum up their rating from all 6 review sites, you’ll get an average of 3.05.
CreditAssociates won’t charge you any fee in advance when they help you with debt negotiation. Rather, you’ll only pay a fee if you accept the settlement struck on your behalf. CreditAssociates withdraws their service cost and settlement payment from a Special Purpose Savings Account.
However, when they make their deductions, it may be as much as 20% of your original debt sum.
CreditAssociates don’t provide sample costs, which vary with state regulations. Speak with a representative on fees during the free consultation period.
We’ll advise that you discuss with a financial expert on taxes you owe on the canceled debt. You may get a tax exemption on passive income.
Thinking of opting for CreditAssociates for debt relief? It’s best to first elucidate its pros and cons to understand the choice you’re about to make.
Let’s consider some great aspects of the Credit Associates debt relief service. Here are a few of its multiple pros:
Let’s discuss each of these points:
CreditAssociates completes the debt negotiation process within 36 months. This gives debtors quicker debt exiting time than keeping to the original payment schedule.
It’s intimidating and difficult trying to exit debt on your own. However, there are alternatives to help with this, although they don’t always work. With CreditAssociates, you’ll have industry experts providing you guidance. They have experience in helping others to negotiate debt and can easily assist with yours.
A whole lot of people are seriously indebted and don’t seem to have a way out. If you’re in this predicament, both bankruptcy and debt consolidation don’t seem possible. Then approaching CreditAssociates for help maybe your only option.
Credit Associates has a number of cons to consider. These demerits will open your eyes to something to consider, that may be detrimental to your finances. Some cons to using CreditAssociates are:
Basically, CreditAssociates require you to stop sending money to credits and instead send those payments to CreditAssociates. The company then holds your money in a special savings account.
While you’re doing this, your credit score is being affected as you’re not meeting your debt obligation.
CreditAssociates is not available for debt negotiation in every state. These states are Ohio, Wyoming, Vermont, Maryland, Minnesota, Connecticut, and Colorado.
There is no certainty of getting a debt discharge with this option. Imagine getting your credit score reduced to the trash and not still achieving your aim. It’s best to understand this reality before favoring the process.
CreditAssociates clearly elucidated on its website that every individual’s situation is peculiar, and can’t guarantee results.
The cons of debt settlement are quite significant. One such is that there’s no guarantee it’ll work. Also, a 15%-25% fee is outrightly exorbitant. If you’re considering an alternative to debt settlement, here are other options to try:
With over a decade of experience in resolving debt issues, CreditAssociates is a legit debt settlement company. They can be beneficial to debtors whose creditors are willing to negotiate debt terms. Especially if you can prove that circumstances are indeed outside your control.
However, it has multiple demerits to consider. For one, the fees involved are outrageous, and the company won’t divulge its fee beforehand.
To edge out these demerits, we laid out other debt settlement companies to consider. And if you'd like to ditch debt settlement entirely, then the options are within the article.
Exiting debt is a difficult process. As such, we’re helping you understand one of your options.