National Debt Relief is best suited for people who have experienced a financial crisis and want to manage and pay off their debt without paying high interest charges, taking out debt consolidation loans, or filing for bankruptcy. Paying off debt as an individual can be difficult, making national debt relief a great option for those looking for a service to negotiate on their behalf.
While the extent of debt reduction varies from case to case, National Debt Relief has a proven track record of negotiating with creditors to significantly reduce customer debt. However, it is important to note that there is no guarantee that creditors will be willing to work with debt relief companies.
If you decide to work with National Debt Relief, it’s important to know what to expect from the process. When you first apply, a certified specialist will review your credit history to ensure you qualify for the debt settlement program. Once your eligibility is verified and you begin working with National Debt Relief, an escrow account will be opened in your name with Global Client Solutions that only you can control. You then send an agreed-upon monthly deposit to National Debt Relief, which is deposited into your escrow account.
In the meantime, National Debt Relief will negotiate with creditors on your behalf. They will contact you when they are paying off a debt and ask you to release the money from your account to pay the settlement. As a rule, your first statement will be made within three to six months. While the total length of the program depends on your individual debt, it generally takes between 24 and 48 months to pay off all of your debt.
In order to qualify for the National Debt Relief program, a number of factors come into play. You must have more than $7500 in debt and be at least several months in arrears on payments. You must also be able to make monthly payments to National Debt Relief at an agreed rate.
The final eligibility criteria are less straightforward. You must be able to show that you are in financial distress that is unlikely to end any time soon. This criterion is important to National Debt Relief’s ability to negotiate on your behalf.
While National Debt Relief does not charge upfront fees, they do charge a fee once all of your registered debts have been settled. On average, National Debt Relief collects 15 percent to 25 percent of the total debts paid.
|No upfront fees:
National Debt Relief doesn’t charge you until they deliver results
|High closing fees at 15 percent to 25 percent of total debt:
While this program will likely save you money, National Debt Relief charges a fairly high entry fee that has the potential to negate the benefits of enrollment.
|Positive customer reviews:
National Debt Relief has an A-score from the Better Business Bureau and a score of 4.7 out of 5 on TrustPilot.
Signing up for a debt settlement program will significantly affect your credit score. While it’s likely that your credit score will recover after completing the program, there’s no guarantee.
|Free initial consultation:
National Debt Relief offers a free, no-obligation initial consultation.
|No settlement guarantee/possibility of being sued by creditors:
Creditors are not required to cooperate with debt relief companies and may choose not to. It’s also possible that creditors will sue you if you stop making payments to work with National Debt Relief.
National Debt Relief Customer Reviews
National Debt Relief has an average of 4.31 out of 5 stars from customer reviews published with the BBB. The company has also filed 254 complaints with the BBB over the past three years.
In comparison, New Era Debt Solutions, one of National Debt Relief’s top competitors, has an average of 4.85/5 stars from BBB customer reviews. New Era Debt Solutions also has a very low complaint rate, with only 3 complaints in the last three years. Freedom Debt Relief, another top competitor, averages 4.35 out of 5 stars on BBB customer reviews. They had 395 customer complaints in the last three years.
Overall, National Debt Relief is a highly rated and accredited debt relief company with results and customer reviews on par with its top competitors.
Debt Settlement Risks
While working with a debt settlement company has several advantages, there are also many disadvantages.
No settlement guarantee
The most obvious risk is that there is no guarantee that National Debt Relief or any other debt relief company can pay off your debt.
People are usually advised to stop making payments to creditors once they start working with a debt relief company. A missing final statement leads to higher interest and reminder fees. This could leave you with more debt than you had when you started. Lack of settlement also leaves you vulnerable to potential lawsuits from creditors.
Another risk associated with stopping your payments to creditors is the damage it does to your credit score. Companies like National Debt Relief are reassuring customers that this drop in their credit ratings is temporary and will be fixed once the debt settlement program is complete.
However, there is no guarantee of this. In fact, accounts marked as “settled” on credit reports can negatively impact your credit score.
You might end up paying more
In addition to the high post-payment service fees National Debt Relief and other debt relief companies charge, interest and late fees accrue on debt after you fail to pay it. These charges could make your debt higher than what you originally owed.
Paying off debt may take longer than expected
Paying off debt often takes up to three to four years.
Alternatives to government debt relief
If working with a debt settlement company isn’t right for you, there are several other options available to you to reduce your debt.
Manage debt yourself or with a credit counselor
It is possible to manage your debt yourself. This option can be difficult to navigate and requires self-discipline and organization. Luckily, strategies like the debt snowball and debt avalanche can help.
There are also small things you can do to make managing your debt easier, including sticking to a budget, setting up an emergency savings account, and taking steps to reduce your monthly bills. To simplify this process, it might be beneficial to work with a credit counselor. These agencies take an in-depth look at your financial situation and provide recommendations and strategies on how to proceed.
If you can’t manage your debt yourself, you can also consider debt consolidation. This is the process of consolidating all of your debt into a new loan.
Consolidation makes your debt payments more manageable because you can make one payment a month instead of many. It can also reduce any outstanding interest on your loans. You can complete the debt restructuring through a credit counseling center or apply for a debt restructuring loan yourself.
Debt consolidation comes with its own risks. These include upfront costs, collateral risk, and the possibility of increasing the overall cost of your debt.
Another way to manage your debt is to perform a balance transfer. This process involves transferring your outstanding credit card debt to a wire transfer credit card. This is any credit card that allows you to transfer funds from other accounts.
These accounts typically offer an annual percentage rate (APR) of 0 percent for a limited period (12 to 24 months). This option instantly saves you money on interest and allows you to transfer your payments straight to your main balance. Balance transfers are usually a good option for those with a lot of high-interest debt, but opening a new credit card always comes with the risk of accumulating new balances.
The last option for debt management is filing for bankruptcy. This is usually the last resort for most but could be the best option depending on your financial situation.
There are two types of bankruptcy, Chapter 7 and Chapter 13. Filing Chapter 7 will erase almost all of your debt, while Chapter 13 will recognize your debt so you can pay off some of it. While filing for bankruptcy can provide instant debt relief, it does significant damage to your credit score and can negatively impact employment and your ability to rent.
The central theses
- National Debt Relief is a premier debt relief company with high customer ratings, a solid reputation, and generally positive customer reviews
- Paying off debt can be a great option for debt relief, but it comes with risks and the process may not be right for everyone
- National Debt Relief offers a free initial consultation and does not charge upfront fees, but post-processing fees tend to be high
How Bankrate evaluates sovereign debt relief
|Services||4.3||Services were evaluated based on minimum debt capacity, the type of eligible debt, and whether the company offers free credit counseling.|
|affordability||4.9||Affordability was assessed based on the fees involved and whether or not the company sets terms for the money-back guarantee.|
|customer experience||4.0||The customer experience was evaluated based on the usability and features of the website and the availability of apps.|
|Customer satisfaction and company reputation||4.7||Customer satisfaction and company reputation were assessed based on Better Business Bureau accreditation and ratings, as well as TrustPilot reviews.|
|stability||4.0||Stability was judged on how long the company has been in business and whether or not it remains a member of a professional association.|