This article is for informational purposes only and should not be construed as legal or financial advice.
I have spoken with approximately 1,000 people about debt consolidation over the past decade, and our
free debt consolidation calculators have helped over 40,000 individuals understand their loan options and alternatives, so I understand what Debt Clear USA is and specifically the debt backpack method that he discussed in his ad.
During a recent social media scroll, I came across an ad for Debt Clear USA, which prompted me to conduct a thorough investigation into the company and write a brief review article to share information about them.
Firstly, the ad
features Robert Herjavec (from Shark Tank), who states that he used to work for a collection agency, so he knows how they operate and what they’re looking for. They marked it as the way “millionaires get out of debt.”
I did find this ad to be pretty informative, as it was close to 5 minutes long. However, I believe it left out some key information that would be important to know when signing up for a program like the one they were advertising. The two biggest pieces of information that would have been crucial to include regarding a debt settlement program (like Debt Clear USA), is that you have to fall behind on accounts and close them when entering the program. The second is that there is a legal risk involved with this type of program because your creditors do not have to agree to these negotiations.
If you are struggling with debt and don’t know your options, please consider taking this free
personal loan and alternatives options calculator to estimate loan qualification and learn about alternatives. No personal information is required unless you want to provide it.
In terms of the process, Robert made it seem pretty simple, you just have to fill out this form with a few pieces of information, and then they would reach out to get the negotiation process started.
The product they are advertising is called debt consolidation, also known as debt relief. I can explain how debt consolidation/debt relief works, but I believe it would be more helpful if you watched my
recent video below.
What is the Debt Backpack Method?
Robert Herjavec uses a metaphor to describe the debt backpack method as a debt payoff strategy. He states that debt is like rocks that you continue to add to the backpack. You may get a loan, but that loan has interest, so are you really taking rocks out of your backpack or do you just keep adding rocks to your backpack?
My understanding is that Herjavec states that the debt backpack's goal is to reduce the total amount owed, likening it to removing rocks from your backpack.
The challenge with reducing the total amount owed is that you generally have to fall behind on your debt for the creditors to be willing to reduce the total amount owed.
That can lead to debt collection calls, a negative hit to your credit score and potentially getting sued for unpaid debt.
Another debt consolidation option is called non-profit credit counseling.
Consider Credit Counseling
Unfortunately, many people I speak with do NOT qualify for debt consolidation loans, so nonprofit credit counseling is a debt consolidation option that I have loved recently. In non-profit credit counseling, an agency negotiates your interest rates down and gets you on a fixed monthly payment. You also consolidate all your high-interest credit cards, often into a lower monthly payment. In addition, your accounts DO NOT go behind, so you won't be sued by creditors and your credit score could go up, not down.
You may have to qualify, but I created this
free calculator to compare credit counseling and debt consolidation and estimate your eligibility.
Finally, when I went to look at Debt Clear USA reviews, it took me to Americor reviews.
Debt Clear USA Reviews
Americor is a very popular debt relief company, so they have many reviews on
TrustPilot,
BBB, and
Google. I found positive and negative reviews about Americor, so let's dive into a few.
Trustpilot Reviews
Here's a recent positive review.
Here's a recent negative review.
In this review, Katherine mentions that many of her payments go directly to Americor and very little to her creditors. She feels the company is a false advertisement and experiences her creditors coming after her while in the program.
BBB Reviews
Let's look at recent positive reviews.
This BBB review from Ryan showed appreciation for Americor. He stated that they are very helpful and feel as though they make him a top priority. He also appreciates that the ball is in his court to make decisions.
Google Reviews
Americor has a 4.8 rating based on over 13,000 reviews on Google.
Here's a recent negative review.
This Google review is one I appreciated since it's from someone who has been working with them for a couple years.
She mentions feeling misled in the process and feels as though the process has been explained to her in many different ways. Another important point is that her credit score dropped pretty significantly, which is a con of doing a settlement program.
Overall, it is helpful to do your research and see if a company is a good fit for you and your situation. Ensure you have all of the information from the company before making any final decisions.
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