Our debt settlement program is designed for people who experienced a severe financial hardship and want to avoid filing for bankruptcy. The below description explains how our program works, however, before you make any decisions we strongly recommend that you read and review all of your options. You can speak with one of our experienced debt consultants who will clarify the program in detail and verify whether or not you qualify.
Francois and Associates strongly encourages you to read our Debt Settlement FAQ.
Q. Who is qualified for our program?
Q. Who is NOT qualified for our program?
Q. How will Francois and Associates settle my debts?
Q. Who can join Francois and Associates’ program?
Q. Is bankruptcy a better option for me?
Q. Does Debt Settlement have a negative impact on my credit?
Q. Can I still use my credit cards?
Q. What will I pay for your services?
Q. Do you guarantee that you settle all of my debts?
Q. Can Francois and Associates stop my creditors from calling?
Q. Does Francois and Associates repair my credit?
Q. Can creditors garnish my wages?
Q. What are the tax consequences?
Q. Who is qualified for our program?
A. Francois and Associates’ debt settlement program is only for people facing financial HARDSHIP. If you are late on paying debts, have little or no ability to pay debts in the future, and are facing a possible bankruptcy, you should qualify.
Q. Who is NOT qualified for our program?
A. Francois and Associates does not advocate defaulting on debts. This program is not designed to negotiate debts for those who have reasonable means to pay off debts. This program is NOT for people who have high credit ratings and can meet their monthly debt obligations.
Q. How do you apply?
A. Complete the form online or call us directly. After a debt consultant has reviewed your financial situation and hardship, they will determine if you are qualified for our program.
Q. How will Francois and Associates settle my debts?
A. You will be asked to make monthly deposits into an FDIC insured special purpose bank account. This deposit amount will be determined in your initial analysis based on total amount of debt and will be in line with your income and expense budget. Once you have accumulated enough settlement funds to make a reasonable offer to your creditors to settle the debt. Francois and Associates will begin the negotiation process. Each person’s situation is different and the negotiation process will vary depending on the amount of the debt. Once the creditors agree to a settlement amount, we will present this offer to you for approval of the settlement in writing. Debts can be settled in two different ways; one lump sum or a term settlement. One lump sum is just that, one payment and the account is paid. A term settlement is a settlement which is paid over an extended period of time until the account is paid.
Important facts you need to know about Debt Settlement.
Q. Who can join Francois and Associates’ program?
A. Francois and Associates’ debt settlement program is a hardship program. This program is only for people who:
- have a financial hardship
- are late paying their unsecured debts
- have no ability to make payments in the future
- bankruptcy is the only other option
Examples of qualifying hardships are a loss of income, medical emergency, death of a member of the household who provided financial assistance, or a divorce.
If you are currently meeting your monthly debt obligations and are able to continue to do so, then a Debt Settlement program is NOT for you.
Q. Is bankruptcy a better option for me?
A. Anyone considering our program should also contact a bankruptcy attorney to determine if their situation warrants filing for bankruptcy. Using the Debt Settlement process does not guarantee that you will not have to file for bankruptcy in the future.
Q. Does Debt Settlement have a negative impact on my credit?
A. YES. Your credit score will decline as a result of entering this program. The quantity of the decline depends on your original circumstances. Most of the accounts you place into negotiation are likely to “charge off”, which will reflect negatively on your credit. However, once this charged off debt is settled, the settlement is reported to the credit bureaus. Settled accounts are positive compared to unresolved delinquent debts or bankruptcy. There are many variables to an individual’s credit score, but after all debts have been settled and paid, your credit score should begin to improve.
Q. Can I still use my credit cards?
A. NO. All credit cards involved in the program will not be active and you will not have credit privileges with the enrolled creditors. Any cards you DO NOT put into the program should not be used, as the purpose for enrolling is to get out of debt.
Q. What will I pay for your services?
A. You will pay a fee which is calculated based on the savings amount and total amount of debt that you bring into the debt settlement program. All costs and fees are always fully disclosed, and you are required to sign for approval before you commit to our program.
Q. Do you guarantee that you settle all of my debts?
A. NO. There is no guarantee that your creditors will negotiate with us or that your debts will be reduced.
Q. Can I be sued?
A. YES. Your creditors certainly have the right to sue to recover their money, but usually the purpose of the lawsuit is to force a settlement on the matter. In our experience, most creditors would rather not go to the expense of suing and would prefer to negotiate a settlement.
Q. Can Francois and Associates stop my creditors from calling?
A. NO. Your creditors have every right to contact you in order to collect a debt, however, we have been successful in eliminating most harassing telephone calls. If your account is in collections, collections agencies have to adhere to the FDCPA Guidelines. If you would like to learn more, please read Fair Collection Practices Act.
Q. Does Francois and Associates repair my credit?
A. NO. Companies cannot remove legitimate negative items from your credit report. Negative items will remain on your credit report according to the conditions imposed by the credit reporting agencies. The goal of a Debt Settlement program is to settle your delinquent accounts. When a delinquent account is settled, this is reflected on your credit report. A settled account is better than an unresolved delinquent account. Your credit score should improve after successfully completing our program because paid debts will recuperate your debt-to-income ratio. Although debt-to-income ratios are not part of a credit score, they are an important measurement by which lenders evaluate applicants for auto and home loans.
Q. Can creditors garnish my wages?
A. YES. However, this is can be a long process for the creditors. The creditor first has to sue you, successfully obtain a judgment, and then file for a garnishment action. If you’re willing to work with your creditors, wage garnishment can normally be avoided.
Q. What are the tax consequences?
A. Your creditors will report cancelled/settled debts exceeding $600 to the IRS and you are required to report the same as income on your annual tax return. The IRS permits you to write off any “income” from canceled debts up to the amount by which you were “insolvent” at the time. You need to consult your own tax advisor for advice specific to your situation.
