How to Choose the Right Path Out of Debt | Live Q&A with Relief Strategies CEO James Farias

Feeling overwhelmed by debt? You're not alone

Debt relief isn’t one-size-fits-all. If you're staring down a mountain of bills, calls from collectors, or a lawsuit notice in the mail, the first thing you need to do is pause and evaluate your options.

James Farias has spent years helping people sort through the chaos. As the founder of Relief Strategies, he takes a non-judgmental, solution-focused approach. He "just want[s] people to know they’re not alone, and they have options.”

If you're in debt, there's no need to feel shame. In fact, shame and fear can keep people stuck in debt longer than they need to be, in Jame's words, "they just put their head in the sand when it comes to addressing debt," and make the issue worse by ignoring it. Jame's aims to end the stigma around getting out of debt and finding relief.

What actually works when getting out of debt?

There are several legitimate ways to resolve debt, and each comes with pros, cons, and trade-offs. Some options may affect your credit score, while others might come with fees, legal consequences, or extended repayment timelines. The best strategy depends on your situation so here are the most common paths and what to expect from each:

1. Debt settlement: This is when you negotiate to pay less than the total amount owed for your debt. This path is best suited for people who are already missing payments or considering bankruptcy. While it may hurt your credit further, many people in this situation already have significant damage, so debt settlement may be a net benefit in the end.
2. Chapter 7 or 13 Bankruptcy: Bankruptcy is a legal process that can eliminate or restructure debt. It does stay on your credit report for years but it also may offer the cleanest slate to start over and is a great legal tool to help you if you're in debt.
3. Debt management plans (DMPs): Offered by nonprofit credit counseling agencies, these plans roll multiple payments into one monthly bill with reduced interest. You will still need to repay most or all of the debt, but your payments will be negotiated and consolidated by the counseling agency.
4. Federal student loan programs: If your debt includes federal student loans, don’t rush to settle. Instead, explore options like income-driven repayment (IDR), forbearance, or Public Service Loan Forgiveness (PSLF) and see if you qualify. These are almost always better than private settlement firms.

The right choice for getting out of debt depends on your personal situation, including your total debt amount, your income and expenses, whether you're already behind on payments, and they type of debt you have (credit cards, medical bills, student loans, etc.)

James points out that settlement is not for people whose finances are just “getting tight.” It’s typically for those who are already considering bankruptcy and need a solution.

What's the best debt relief path for me?

Everyone's path out of debt is unique to their situation and there's no one-size-fits-all approach. Your path out of debt depends on your circumstances, but you can assess where to get started.

Here’s a quick guide to help you self-assess:

• Just lost your job? Start by calling your creditors. Many offer hardship programs, payment pauses, or lower interest.
• Owe $10K+ across multiple credit cards? You may qualify for settlement, but expect your credit to be impacted.
• Overwhelmed with student loans? Use government resources before paying a private company, there may be relief options available depending on your job, income, etc.
• Already being sued? Prioritize responding to the lawsuit first, it's important that you don't ignore a lawsuit if you're being sued for debt.

The strategy you choose will depend on your personal situation and every strategy has trade-offs. However, weighing your options can help you cross the bridge to financial stability.

Talk to your creditors early

One of the most powerful things you can do? Communicate.

If you’ve experienced a job loss, medical emergency, or financial hardship, don’t wait until accounts are delinquent. Call your creditors, explain your situation, and ask what programs they offer. There's no guarantee, but they may be able to reduce your interest rate, offer payment deferrals, or pause your account without sending it to collections.

Hiding from phone calls might feel safer, but it can limit your options. Most collectors and creditors are more flexible before accounts are charged off.

Verify the debt before you pay

If you have multiple creditors contacting you about the same debt, that’s a red flag you shouldn't ignore. Before you pay or give any information, make sure you ask them to validate the debt. This is a legal requirement under the FDCPA. If you’re being sued, prioritize responding to the lawsuit (you may face wage garnishment if you don’t). For any other collector, send a debt validation letter and wait for proof.

If you’re unsure how to respond, Solo can help:

Respond to debt collection lawsuits fast with Solo.

Solo even helps you generate and file your legal Answer document, buying you time to create a plan, whether that’s fighting the lawsuit or settling outside of court.

What about student loan forgiveness?

If you have federal student loans, there are real relief options, and you can apply for them yourself.

Many service providers offer income-driven repayment (IDR) plans and public service forgiveness. James recommends:

• Logging into your student loan portal
• Exploring available programs directly
• Avoiding third-party companies unless you’ve vetted them for complaints or scams

Relief Strategies partners with providers to help people navigate this process, but most federal loan servicers are legally required to provide it for free. Always check with them first and find out your options through your federal student loan servicer.

What happens if you don’t pay a debt back?

Yes, debt collectors can sue you and often do if the balance is large enough.

Some people think a $1,000 balance won’t trigger legal action. But we’ve seen collectors file lawsuits for as little as $1,500. Once they sue, they can request a default judgment, which could lead to wage garnishment or bank levies.

Your best move? Respond. And make sure the collector has the legal right to collect. They must show original documentation, don’t just take their word for it.

If you’re ready to negotiate and want to avoid phone calls or court, consider using SoloSettle to settle your debt and negotiate online, before you default.

You do have options, so use them

Debt can feel overwhelming, but it doesn’t have to stay that way. The best path out of debt depends on your situation and you may need to weigh multiple options before finding what fits.

Start with an honest financial assessment and determine what you owe and what you can realistically pay. Then explore all your choices.

If you want help navigating this process, check out:

• Solo for lawsuit response tools and settlements
• ReliefStrategies.com to learn more about James’s approach to personalized debt relief

You’re not alone in this and your next move could put you on a path toward lasting financial freedom.

Transcript

Hannah (00:36):

Hello everybody. Welcome to the Debt Hotline. Thank you so much for listening. We're really excited for the topic that we'll be discussing today and our special guest. Our topic for the Debt hotline today is how to choose the right path out of debt. We're having a q and a with James Farias. He's the CEO of Relief strategies. I wanted to take a minute to introduce him, but before I get into that, I also wanted to introduce myself. My name is Hannah Locklear. I am a part of Team Solo. We host this podcast twice a week where we answer real questions from real people about debt and we can help you at Solo respond to a debt lawsuit. If you've been sued. We can also help you settle your debts for less and resolve your debts with the help of technology. If you have questions about debt, you can call the debt hotline at zero one six one three eight one eight one and submit your questions via voicemail.

We respond to those questions every single week and we love to try to help point people in the right direction. Before we jump into things too, I wanted to say that I am not an attorney, neither is James. We do know quite a bit about the debt industry and whatnot, so James is especially an expert in this space. But anything that we share today and the answers to any questions we share, please don't take them as legal or financial advice. They're just resources and information to try to help point you in the right direction and provide educational resources, like I said. So that being said, James, welcome to the Debt Hotline. Thank you so much for joining. I wanted to give a little intro and then maybe you can fill in any gaps that I may have missed. So James is the founder and CEO of Relief strategies where he helps people get out of debt through transparent strategic solutions like settlement, federal student loan support and credit rebuilding. He has more than 30 years of experience in leadership, team building and sales operations, and he has dedicated his recent work to transforming how people approach debt relief. His focus is on clarity, honesty, and long-term success. So James currently leads Relief Strategies to shift the conversation surrounding debt and make it less intimidating, more human and rooted in real results. James, can you fill in any gaps that I might've missed and tell us a little bit more about what you do at Relief Strategies and how Relief Strategies for its users?

James Farias (03:00):

Yeah, that was a great introduction. It's almost like we know each other. That's so perfect, Hannah. I appreciate that. For me, debt is such a personal topic and I feel like it's probably that way for everybody else. I got into the financial services space actually as a life insurance agent quite a few years ago, primarily helping teachers with their retirement and things of that nature. At the time I had six kids and I was coaching high school football, and so this was a perfect fit for me. I was already in the ecosystem. I knew a lot of teachers, I knew a lot of coaches, but as I started actually trying to help them, what I found was that the people who needed to help the most often had the ability to be helped or help themselves the least. And most of the time it's just because they were just drowning in debt between federal student loans.

A lot of these teachers are coming out of pocket for themselves funding their own classrooms and things of that nature, and a lot of them are doing it on credit cards very often, especially as young teachers. And so as I was trying to help them put money away for the future, it was hard sometimes for me to be helping them, showing them things that might help them put away like four or five, 7% or really good year when I knew that they're just getting crushed by 20 sometimes 30% debt on the backend. And so it was important for me to try to find a solution that would resonate with this demographic specifically and for everybody that's settled with debt, to be able to find a way to get out of debt in a way that's not embarrassing, it's welcoming and open and doesn't make them feel shame. And unfortunately, I'm sure that you folks deal with this too since you play in the settlement space. Even when you're doing everything right, you're often looked at as a scam and unfortunately there's a lot of stuff out there that calls settlement a scam and they'll explain it correctly while they're doing it because there's so much misinformation out there. So trying to make the information more accessible, more interesting, more entertaining, less embarrassing things of that nature, that's kind of been the focus of what we've been trying to do.

Hannah (05:01):

Perfect. And can you tell us, James, what it might look like for a typical user at Relief Strategies to actually use the platform and engage with your workers and find those Relief Strategies?

James Farias (05:13):

Yeah, absolutely. So we do have a full fledged website. There's a lot of information on that. It's pretty informative. I write a lot of the topic. I try to write a topic every week and tie it to current events I don't get to every week. I didn't write one this week of course. But aside from that, on the site itself, there's a lot of information that will help them. And then when they reach out to us, the first thing they'll get is actually that they're going to talk to an AI interface, to be honest with you, and this is something we're playing with because I feel like debt is so hard for some people to talk about. Sometimes they just want to see is this something I can even get help with before they talk to a real person? So we'll have an AI that will reach out to 'em, it's very humanlike, but it's not human. It'll tell them that it's not human and they'll kind of go through is it even a really a good fit for them? And if they find that their situation is a good fit for some of the offerings we have, then they can set an appointment or be transferred live and actually talk to somebody live. So for us, we have a lot of technology on the backend, but most of it is live interaction with a human to get 'em through the end of the process once they find out that they're a good fit.

Hannah (06:25):

What types of strategies does Relief Strategies offer for debt relief?

James Farias (06:29):

Yeah, great question. Our primary solution is debt settlement. However, we can help people with consolidation. We can help people with credit repair and of course separate from settlement because the consequences are separate. It's not settlement, but federal student loans, we do a lot of work in the federal student loan world too.

Hannah (06:48):

Perfect. So I think a very common question in the debt space for people dealing with debt, especially multiple lines of debt or multiple lines of credit, I think a very common question is what is the best debt relief path for me and my particular situation? And obviously there are so many factors that play into it, but it seems like Relief Strategies is a really great resource out there to help you figure out what the best strategy could be for you and your particular situation. Would you agree?

James Farias (07:18):

I might be a little partial, but yes, I do agree. It is important for us to inform and educate people. So anytime somebody is going through the process of finding out a settlement would be the right fit for them, we do educate them on all of the things that are available, even things that we can't help them with, just to make sure that one they know and two, that they have access to the information to go find out the other resources if it's a better fit for them because settlement is not for everybody. And I think that's where a lot of the outfits get into trouble, and I think that's where a lot of the bad negative press comes from is people trying to put a square peg in round hole. If you don't educate the people and let 'em know what's going on or what's available out there and you just force 'em into a settlement program and they don't really understand the ramifications, there is a very good hit unless their credit is already really bad that they're going to take a hit to their credit and that it's like a topic that everybody's so afraid to talk about for some reason.

So finding the right solution is important and understanding the ramifications is important. Somebody who's looking for settlement is somebody who's already thinking about it as bankruptcy on the mind. It's not somebody who's like, man, things are getting tight. They might be looking for more of a debt management plan, or they might even be in a world where consolidation is the right option for them where they can just get a single loan to pay off all their debts and then pay the loan off, which is also a viable option for a lot of people if their credit is still strong and they're catching it early enough and things of that nature. And some people, no matter how dire is, unless they're willing to give up a lot of things, settlement and bankruptcy is off the table because of things like the job they have that prevents it. So there are a lot of, I wish there was an easy matrix that could say if this much debt and this many lines, this is the option for you. But really every one of these situations is really personal. It's important that you work with somebody that understands the nuances that can help guide you in the right direction.

Hannah (09:09):

Very well said. Yes. There are so many nuances and it's important to get connected with the right people, organizations, resources and tools to help figure out what's best for you in your particular situation. And that's actually a great segue into some of the questions we've received from real people regarding these topics. Let's go ahead and jump into some questions if that's all right with you, James.

James Farias (09:30):

Yeah, I'm excited. Let's do it.

Hannah (09:32):

Awesome. So our first question comes from Samantha in California. She says, I'm $42,000 in debt, mostly credit cards and an old personal loan. I've been researching settlement, but I keep hearing conflicting information. Some say it wrecks your credit, others say it's better than bankruptcy. How should I know what's right for me?

James Farias (09:53):

Yeah, it's good. It's funny, we were just talking about that credit hit and all of that. So for settlement, I would say that the first thing is understand how much debt you have, how much income you have, and make whatever cuts to expenses you can to get to that absolute bare minimum number to decide how big the problem is. But if that's where we're at, where we do understand our problem and we do need a solution, I guess it's important to understand that most people who are thinking about settlement, they probably already have taken hits to their credit. Most of them already have a really high debt income ratio or they have really high utilization or they might've already started missing payments or maybe even be in collections. So should we be concerned that we're going to take a credit hit, you're going to take a credit hit unless your credit is really bad.

That's kind of a given and it's important to understand that. But if you're coming to me with several collections and missed payments and whatnot, your credit hit is going to be different than somebody who just woke up with a seven 50 and realizes like, I just got laid off and if I don't make a change immediately, I'm about to jump off a cliff. I drive off a cliff, not physically, but with my finances. So it's important to understand the better off you are when you start, the further you have to fall. But it's also important to understand that if you're trying to really get out of debt, there's got to be a trade off. These creditors are giving up the amount of money you owe, the trade-off is you're going to take a temporary hit to your credit. Now, determining which solution is the right solution for you really comes down to how much debt you have and how long a timeframe you're looking at bankruptcy.

If you're insolvent, if you know you're upside down, we always recommend bankruptcy. We do a cashflow analysis for people if they're upside down, we won't put 'em in a settlement plan. It doesn't do 'em any good. They have to either fix their income side or they really just go look at bankruptcy. If that's in solvent, because then you're likely to qualify for a chapter seven, you're likely to have your debts absolved, and then you just deal with a 10 year credit hit. But if you're in that big of a problem, the credit hit is not the thing you're worried about. Now, if you're right before that stage and you're in over your head and you're trying to avoid bankruptcy, settlement is a phenomenal way to not have a 10 year hit to be able to pick and choose which lines of credit you really need the help with and not have to put everything in and to not have a plan that's monitored by a court and telling you what you can or can't do. But again, you're still going to take a credit hit. So it's not really about am I going to you're, it's really about the degree to which it's going to occur, and that comes down to if you're doing bankruptcy or settlement and of course where you start when you enter into whatever program you choose.

Hannah (12:45):

Yeah, I think there's a lot of factors that will affect how your credit gets hit when you settle a debt for less. Usually debt settlement, most sources online say that your score will drop maybe around a hundred points when you settle a debt. However, settling a debt will not look as bad on your credit report as a delinquent debt. So unpaid debt is probably the worst thing that you can have on your report that along with debt and collections. So again, settlement will affect your credit score and it probably won't have a positive impact, but nothing will be worse than an unpaid delinquent debt. Awesome. Let's see. Let's jump to the next question. So this one is from Juan in Texas. It says, I just got laid off and I'm sitting on $18,000 in credit card debt. I've been making my minimum payments, but now I can't even do that. What should I do?

James Farias (13:36):

Oh, yeah, that's a good question. Kind of like with the previous, that was at Samantha, I believe in California, one of the biggest things is make sure you get a hold of your finances, see if there's anything you can do to cut expenses and maybe even something you can do to earn some more money. I mean, people sell things on eBay, things of that nature to try to make ends meet. But at the end of the day, if it is the case that you're with ends and there's nothing you can do, I would say the most important thing is to communicate with your creditors first. Quickly, don't wait. The longer you sit on it, the worse it's going to be for you. A lot of times the creditors will have ways for you to defer payments or come up with some kind of structured payment plan where they'll put the debt on the end of your a debt or things of that nature where it won't even necessarily really impact your credit or it'll be much lesser impact on your credit.

But at the end of the day, if you're not able to do that, then you might start need to start looking at something like a debt management plan where you can get a nonprofit involved. They can do some negotiating for you. They can't really negotiate your debts necessarily, but they might be able to help you with fees and interest and things of that nature depending on how long and how bad this is going to be. And then again, depending on how long and how bad it's going to be, you might have to start looking at cellular bankruptcy potentially. But I would start working with my creditors right away and see what options they have because again, a lot of them have ways for you to defer, for you to pause payments for you to come up with some kind of structured repayment plan to get back on board because at the end of the day, they don't want to sue you. They don't want you to go delinquent. They want to have a client that's going to pay their minimums for the next 20 or 30 years or 50 years or however long you're going to be alive. That's the best outcome for all of them. So I would recommend reach out to your creditors immediately and try to get some kind of leverage with them.

Hannah (15:23):

Yeah, I second that. I think the communication is key in situations like this. So Juan, in your situation, definitely contact your creditors, see what your options are, explain your situation and make sure that you're transparent about it all so that they understand and see what options they have for you. Because most creditors will work with you, especially in a situation where you've been laid off and you can't afford the minimum payments. So communication is key. Totally second that. Awesome. Let's jump to the next question from Rosie Ramos says, if you're getting sued by a debt collector, but you're also getting emails from another debt collection agency for the same debt, what should you do? Okay, so this is a really great question, James. I think I could maybe speak to this one and then we'll see if you have anything to add. So if you're being contacted by two different collection agencies about the same debt, you're definitely going to want to ask them to validate the debt.

If you've been sued by one, I would probably prioritize responding to that lawsuit so that you can avoid a default judgment and give yourself time to work out a plan, whether it's fighting the debt in court or trying to settle it before your court date, definitely prioritize the lawsuit. But in the meantime, you may also consider sending a debt validation letter to the other collection agency and just communicating with them and letting them know, Hey, I'm already being contacted about this same debt by someone else. In fact, I've been sued for it. Like why are you contacting me as well? And that might get them off your back. James, do you have anything to add to that?

James Farias (16:48):

No, I think that's great. Absolutely. And it can get tough when you have multiple people trying to collect on the same debt, but at the end of the day, they have to verify they have the right to collect. So I would start there, and especially if you have the original creditor trying to collect from you and a collection agency, definitely want to verify who has the right to actually collect before you start paying anybody.

Hannah (17:07):

For sure. And if you have been sued for debt, we can help you respond to the lawsuit. And again, buy yourself some time to work out a plan. You can go to Solo suit.com to create a personalized legal document that you can file with the court. And in fact, we at SOLO will file it for you to help you defend yourself, protect your rights, and again, figure out your plan and your next steps with the lawsuit, whether it's trying to settle before your court date or trying to go all the way through and fighting it if you feel like the debt is not valid. So great question from Rosie. Another question is from Anthony Gambino. This one says, if I make a payment arrangement with a law firm for the creditor, should it state that I am making payments on my credit report? But it sounds like you've set up a payment arrangement.

Maybe you were sued by a creditor and you set up a payment arrangement with the law firm, and you're asking if that payment arrangement should be reflected on your credit report. In some settlement cases, you can, as part of your agreement, you can have them outlined in your agreement that they will report the debt as settled or they'll remove the mark on your credit report. So Anthony, that's maybe a question that you could ask the law firm directly and just see if there's a way for them to report to the credit bureaus that you're back on track with the payment plan. If you've settled the debt or they've forgiven part of it, that might be reflected on your credit report. Again, like we discussed before, when you settle a debt, it usually is shows up as a mark on your report. However, I think this would be a question that you could directly ask the law firm and just see if there's a way for, as part of this agreement and this new arrangement, see if there's a way for them to report that to the credit bureaus and remove any negative marks associated with that debt.

James, do you have anything to add to that?

James Farias (19:01):

Yeah, I was just going to say pretty much the same thing. Usually there's not any kind of stipulation on the ongoing month-to-month payments of a repayment plan like that, unless it's in writing as part of the agreement, it does have to be marked as paid is agreed or paid, settled once it's done, that does have to be reported, but it doesn't always get reported during the journey. So like I'm saying, work with your law firm and see if it's something that they can convince the creditor to do. It's not out of the realm of possibility, but it would've to be up to the creditor to do that.

Hannah (19:36):

Yes. Okay, perfect. Next question is from Melanie in New Jersey, it says, I've been paying on a student loan for 13 years and still owe over $20,000. I heard there are federal forgiveness options. How do I know if I qualify and who can I trust to help me apply?

James Farias (19:55):

That's a great question. Most for federal student loans, it's almost like settlement really. It's kind of like your breaks. I mean, you can do this yourself. You can usually log into your own provider like Nel Met or Sloan or whoever it is. There's usually a place for you to be able to pretty clearly identify where you can apply for any income driven repayment plans or if you're a public servant, a public servant, loan forgiveness, things of that nature. Usually you can do it yourself. I know that some people get nervous around it. Some of the plans require annual re-certifications, and there's some technicalities to that. So if you're looking for a servicer or a provider, check things like the BBB look for FTC complaints and things of that nature to make sure that you're working with a reputable organization. But to be honest with you, a lot of that stuff can be handled by yourself if you log in and work through your service or provider.

Hannah (20:51):

Yeah. So can you tell us a little bit more, James about how Relief Strategies helps with federal student loan issues?

James Farias (20:59):

Yeah, so we actually work with a third party vendor. TriPoint Alliance is one of our partners. They've been in the federal student loan space for a long time and they work with the people we send over who have student loan questions or issues to determine things like what plans they qualify for, whether it might be income driven repayment, which would be based on married, unmarried, how much income, how many kids, things of that nature. Or there are programs out there like the public service loan forgiveness, which is phenomenal. If a person is working in federal government or government at all, at any level, they've got a.gov address. So teachers fire, if they're a government, fire police, things of that nature postal, there's a lot of really good programs for them. And so they'll just work to determine, and then our partner will actually take on the burden of filing the annual recertification for them should they choose so they don't have to worry about making sure they get that paperwork in every single month and then just go from there.

Hannah (22:01):

Awesome. Well, thank you for explaining. It sounds like Relief Strategies could be a really good resource or tool for you, Melanie, and your situation. So you might want to head over to Relief Strategies.com and check it out.

James Farias (22:12):

Yeah, we'd love to talk to you, Melanie. Absolutely.

Hannah (22:15):

Love it. Perfect. Let's see. Next question is from John in Washington. It says, hi, I'm being sued by Discover Bank for unpaid debt. I was laid off during COVID and fell behind drastically paying the card and eventually was unable to make any payments. I was served a few months ago and filed an answer. A month later I received documents and a notice to appear via telephone for a court date. That's six weeks from now. The amount owed is $21,200. I called Discover Bank's attorney office and made a lump sum offer of $9,000. They counter offered at $16,000. I'm not able to make a lump sum payoff at 16,000, and I called them to ask if they would consider lowering the amount that they refused, should I reach out to them again with a maximum offer, possibly 10,000 or would I do better to file for arbitration?

Discover has a clause in an effort to possibly lower the debt from 16,000. Okay. So John, it sounds like they've already offered you a deal cutting down more than $5,000 on the debt. So that's actually not bad. And keep in mind, since Discover is a bank, they may have access to some of your financial information and know realistically what you could afford to pay At this moment. It sounds like they're being really hard and not budging, but if you can go up slightly, I think it could be a good idea to maybe see if they would accept something a little bit higher and see if they're willing to budge if you budge a little bit. However, I think the most important thing is don't go into an agreement for something that you can't afford. So if you really, truly realistically cannot afford the $16,000 lump sum payment, don't sign any agreement that you're going to pay that off.

I would also say that if you are trying to settle the debt, you could talk to them and see what your options are for monthly payments, and you could break it up into monthly payments if that's a little bit more manageable. But again, if they're already agreeing to cut off $5,000 from the debt amount, that's not horrible, obviously maybe they could do better. And again, I would echo that if you can't afford the $16,000, definitely don't accept it. Keep trying to negotiate, see if they're willing to budge, especially if you show that you're willing to budge a little bit. James, any other thoughts on that?

James Farias (24:41):

Yeah, that's an interesting one. I would say I have to concur the monthly payment thing. Some places do take it. One caveat to that, just to keep in mind is usually it's going to be at a higher rate, a higher overall rate. So a lot of times, just to put it in rough numbers, a bank will take a 60% settlement if you're going to pay everything today, but it might be an 80% settlement if you're going to try to make it over the course of a year or two years. And I also feel like most banks don't want to do anything more than about a year. I've seen some do out to a couple of years, but a lot of 'em don't want to do more than a year because they feel like the default rate is going to be high on anything past that.

And again, one of the things that is beneficial to a settlement plan is it allows for a person to make deposits into a bank account that they control and that the negotiators can use so that they're not necessarily having to come up with $5,000 today. They can make $600 a month for the next five, six months and then have a lump sum payment to make towards a settlement agreement and then allow attorneys to kind of fend off some of the calls and the negotiations while the account builds up. So that is kind of the power of settlement for people that can't do it themselves and then they can't afford a lump sum payment today.

Hannah (26:01):

Yeah, I also want to add to that, that at Solo we also offer a different option for people who want maybe to try settlement at a different rate and route. So we have a tool called Solo Settle that helps people negotiate and settle debts online through our online negotiation platform. And it helps you protect your legal rights. It connects you with collectors and creditors and law firms so that you can negotiate all online without having to do phone calls. It also helps you avoid defaulting further on your payments like a typical debt settlement company or a program might look. Again, those programs can be really helpful depending on your situation. But if you're looking for another option, Solo settle can help you settle the debt outright without having to go into default, save up and then try to settle later on. You can kind of expedite the process on the platform, do it all digitally, avoid going to court, avoid phone calls, and yeah, just kind of digitize the settlement process altogether.

So that's another option. You can check it out at Solo suit.com/Solo. Alright, next question comes from Tracy in Virginia. She says, do I have to pay collections If I don't, can they sue me? The answer is, yes, Tracy, they can sue you if they have the legal right to do so, and if you go long enough without paying, there is a very good chance that they will sue. It also depends on how much you owe. If you owe a couple hundred bucks, they might not see that as worth going to court over. However, if it's in the thousands, in most cases, if you go long enough without paying a collection agency, they will sue you. James, any thoughts on that?

James Farias (27:47):

No, that's spot on. I mean, the only thing I would say is challenge their right to collect that is the one out you might have because they do have to have the original signature and documentation and things of that nature to be able to show that they have the right to collect the debt. So just because they say they have the right to collect, doesn't mean they do. But if they do have the right to collect and it's more than a couple hundred, we've seen some down as low as like a couple thousand dollars, $1,500. Sometimes they will take you to court to try to get a judgment against you to be able to collect the other means. So yes, I would address it. I wouldn't let it sit.

Hannah (28:25):

Amen to that. Don't let it sit, take action, figure things out, don't ignore it. I think lack of action is probably the worst choice that you can take when it comes to debt situations. So just figure out your options. If you don't think you should have to pay this collection agency because the debt isn't valid, then look into your options. Ask them to validate the debt. But if you know that you owe the debt and you just avoid it, things are probably not going to end well in your favor.

James Farias (28:52):

So, it's funny you say that, just small sidebar here. Sorry. Making this conversation more accessible. So my team back a couple of years ago came up with we want to come with a mascot, and our mascot is an ostrich and her name is Ollie, because we feel like that is exactly what everybody does. They just put their head in the sand when it comes to addressing debt, and we're actually working on a whole cast of characters. We're going to be coming up with these, I don't know, cartoons for kids basically to try to teach debt concepts to make 'em easier. So I just thought it was funny that we're talking about people avoiding this conversation and not trying to contact their creditors because that is literally the heart and soul of our mascot and our messaging, because I feel like that's exactly what people do.

Hannah (29:40):

So the Ollie, the Ostrich is Relief Strategies mascot.

James Farias (29:44):

Yes.

Hannah (29:45):

I love that. Yeah, great mascot. Yeah, I think I just echo. It's really important not to bury your head in the sand if you're dealing with debt. Communication is key, like we've said before, and in many cases, collectors, creditors, law firms, everyone will work with you. You just have to be open and honest about your situation and just address it. Don't ignore it.

James Farias (30:11):

A hundred percent.

Hannah (30:12):

Cool. Well, I think we've got time for one more question. So this question comes from Noah in Illinois. It says, I've got about $12,000 in debt spread across four different cards, and I'm only making minimums. I also just had a baby and things are tight. What's the lowest risk way to get ahead without damaging my credit?

James Farias (30:34):

Man, that's new. That's always a joy and a whole bunch of new things like your finances for sure. I just became a new grandparent, as a matter of fact, just like two weeks ago. Congratulations.

Thanks. Yeah. Congratulations to Illinois. Yeah, I would say same thing as we've addressed before, we always want to start with our own expenses, see if there's things that we can cut out of our spending and whatnot to tighten up as much as possible. And then beyond that, just get really serious about how you're going to pay your debt off. It sounds like he's probably not in like trouble yet. He just wants to make sure he doesn't get in trouble. So maybe use the avalanche method, maybe use a snowball method. Either pick the smallest debt, pay it off aggressively, use the extra money to pay off the next smallest debt aggressively, or pick a high interest card, the one that's costing you the most and really put everything extra. You have to paying that off to get rid of that extra interest payment every month. And then as you pay that off, roll that extra money into the next debt until you pay it off.

Do your best not to put new things on the credit card and things of that nature. I think if you're really diligent about not putting new stuff on there, shopping within your limits, assessing your current expenditures, and then be really diligent about paying off, coming over with a plan to pay off your debts. I mean, you could probably do it with no damage if you find that you are in hotter water, it sounds like maybe you could use Solo's plan to do some negotiating on your own or get with a nonprofit debt management plan type organization that might be able to help you get your finances straight without too big of a hit to your credit before you need something like a real settlement or a bankruptcy or something like that.

Hannah (32:22):

I echo what you say about not adding more purchases to the lines of credit that you already have. Definitely as you're trying to pay off the debts, avoid excess spending for sure. But again, if you just had a baby, things are tight, maybe struggling to make ends meet, you can contact your different creditors across those different four credit cards and see what your options are, see if there's an option to lower a minimum payment that might affect your credit score, but it probably wouldn't affect it worse than going delinquent. So that's something to think about as well. Yes. Awesome. Well, I think it is about time to wrap things up. James. Thank you so much for joining. Do you have any other final thoughts or anything else you want to say about Relief Strategies or the work that you do or the topic at hand?

James Farias (33:15):

Yeah, I think it's so interesting. It's such a small, big world out there. I think it's so interesting that you folks reached out to me for this opportunity because you've been on my radar for a couple of months now, actually being that we run in the same space. So I think it's exciting that there are other ways to approach this topic to help people that want to be met in different places that are willing to do it themselves or willing to have the help and willing to do it the right way. Because I feel like there are so many people that are willing to take shortcuts in their attempts to help people that really tarnish the industry, that the industry really needs more people that are willing to actually do the work, to help the industry, to help the people get out of debt. And so thank you very much for having me, and thank you for everything that you folks do out there. I really appreciate it.

Hannah (33:57):

Thank you, James, and ditto to you. Please check out Relief Strategies.com if you have questions about finding the best strategy to help you resolve your debt. It's a great resource for you. So again, Relief Strategies.com. And if you have any questions about debt, please give us a call at the debt hotline. The number, again is 6 1 3 8 1 8 1, and we respond to these questions twice weekly on our podcast. So thanks again, James, for joining. Thanks everybody for listening. Just know that Solo is rooting for you and Relief Strategies is also rooting for you. We know that you can find a solution to your debt.

James Farias (34:37):

Absolutely.

Disclaimer: The information presented in this podcast is intended strictly for general informational purposes and should not be construed as legal, financial, or investment advice. Solo and its hosts are not licensed attorneys, financial advisors, or other certified professionals. While select guests may hold active professional licenses, their contributions are purely for educational thematic discussion. They're not delivering professional or personalized advice. Solo is not a law firm, does not offer legal representation and must not be relied upon as a substitute for professional legal counsel. It is also not engaged in debt, settlement, credit repair, or financial counseling services. So provides self-directed software tools designed to support users in navigating their own legal and financial situations. Participation in this podcast does not establish an attorney-client relationship. Listeners are encouraged to consult with attorneys or licensed professionals for guidance specific to their circumstances. The opinions expressed by podcast participants are their own and do not necessarily reflect the views or official positions of SoloSuit Inc. Doing business as Solo or any affiliated organizations.

How to Answer a Summons for debt collection in all 50 states

Here's a list of guides on how to respond to a debt collection lawsuit in each state:

The Ultimate 50 State Guide

• Alabama
• Alaska
• Arizona
• Arkansas
• California
• Colorado
• Connecticut
• Delaware
• Florida
• Georgia
• Hawaii
• Idaho
• Illinois
• Indiana
• Iowa
• Kansas
• Kentucky
• Louisiana
• Maine
• Maryland
• Massachusetts
• Michigan
• Minnesota
• Mississippi
• Missouri
• Montana
• Nebraska
• Nevada
• New Hampshire
• New Jersey
• New Mexico
• New York
• North Carolina
• North Dakota
• Ohio
• Oklahoma
• Oregon
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota
• Tennessee
• Texas
• Utah
• Vermont; Vermont (Small Claims court)
• Virginia
• Washington
• West Virginia
• Wisconsin
• Wyoming

Guides on how to resolve debt with every debt collector

Are you being sued by a debt collector? We’re making guides on how to resolve debt with each one.

• 11 Charter Communications
• AAA Collections
• Aargon Agency Inc
• Absolute Resolutions Investments LLC
• ACEI Collections
• Account Services
• Accredited Collection Services
• Accredited Collection Services
• Advanced Recovery Systems
• AES NCT
• AFNI Collections
• Alco Capital Group LLC
• Aldous and Associates
• Alliance Collections
• Alliance One
• Alliant Capital Management
• Alpha Recovery Corp
• Alltran Financial
• Alltran Health
• Alorica Inc.
• Amcol Clmbia in Court
• American Coradius International
• American Profit Recovery
• American Recovery Service
• Americollect
• AmSher Collection Services
• Apelles LLC
• AR Resources
• ARC Collections
• ARM Solutions
• Arrow Financial Services
• ARS National Services
• ARSC Debt Collectors
• ARS National Services
• ARstrat
• AscensionPoint Recovery Services
• Asset Acceptance LLC
• Asset Recovery Solutions
• Associated Credit Services
• Atlantic Credit and Finance
• Atradius Collections
• Automated Collection Services, Inc.
• Autovest LLC
• Avante USA
• Avantus
• AWA Collections
• Balekian Hayes
• Bay Area Receivables
• BCA Financial Services
• BC Services
• Benuck and Rainey
• Berlin-Wheeler
• Bluebonnet Financial LLC
• Bonneville Collections
• Bull City Financial
• Bureaus Investment Group
• Cach LLC
• Caine and Weiner
• Capio Partners
• Capital Accounts
• Capital Collections
• Capital Management Services
• CardWorks
• Carmel Financial/New Coast Direct
• Cavalry SPV I LLC
• CBCInnovis
• CBCS Collections
• CBE Group
• CBV Collections
• CCB Credit Services
• CCS Collections
• CCS Offices
• Central Mediation Services
• Central Portfolio Control
• Cerastes LLC
• Choice Recovery
• Choice Recovery Inc
• CKS Financial
• CKMS Financial
• Client Services
• CMRE Financial Services
• COAF
• Coast Professional
• Comenity Bank Debt Collection
• Commonwealth Financial
• ConServe Debt Collection
• Consumer Collection Management
• Contract Callers Inc
• Convergent Healthcare Recoveries
• Convergent Outsourcing
• Couch Conville & Blitt
• Covington Credit
• CRDT First
• Credco in Court
• Credence Resource Management
• Credit Bureau Systems
• Credit Control Corporation
• Credit Management Company
• Credit Management LP
• Credit Systems
• Credit Systems
• CSIEZPay
• CTC Debt Collector
• CVCS Debt Collection
• Cypress Financial Recoveries
• D&A Services
• Daniels, Norelli, Cecere & Tavel P.C.
• DCM Services
• Debt Recovery Solutions
• Delanor Kemper & Associates
• Department Stores National Bank
• Direct Recovery Associates
• Discover Collections
• Diversified Adjustment
• Diversified Consultants
• Diversified Recovery Bureau
• DNF Associates, LLC
• Dodeka LLC
• DRS Credit
• Dynamic Collectors
• Eagle Loan
• Eagle Accounts Group, Inc.
• Eastern Account System
• EduCap
• Ellington and Associates Collections
• Encore Capital Group
• Enerson Law
• Enerson Law LLC
• Enhanced Recovery Company
• EOS CCA
• ERC Collections
• ERSolutions
• Estate Information Services
• Equable Ascent Financial
• Everest Business Funding
• Executive Credit Management
• Faber and Brand
• Factual Data
• Falls Collection Service
• FBCS
• FCO Collections and Outsourcing
• FIA Card Services
• fin rec svc (Financial Recovery Services)
• First Federal Credit Credit Control
• First Financial Bank
• First Portfolio Ventures LLC
• First Progress
• FirstPoint Collection Resources
• Firstsource Advantage
• FMA Alliance
• FNB Omaha
• Forster & Garbus
• Franklin Collection Services
• Freedom Plus
• Freshview Solutions
• Frontline Asset
• Frost Arnett
• Fulton Friedman & Gullace LLP
• Galaxy International Purchasing, LLC
• GC Debt Collection
• GC Services
• General Revenue Corporation
• GLA Collections
• Glass Mountain Capital
• Glasser and Glasser
• Global Credit Collection Corp
• Global Trust Management
• GMAC Financing
• Golden 1 Credit Union
• Grant and Weber
• Grant Mercantile Agency
• Gulf Coast Collection Bureau
• Gurstel
• Halsted Financial Services
• Harris and Harris
• Harvard Collection
• Harvest Credit Management
• Helvey and Associates
• Hollis Cobb
• Holloway Moxley
• Hosto Buchan
• Howard Lee Schiff
• H&R Accounts
• HRRG
• Hudson & Keyse LLC?
• Hunter Warfield
• IC System
• Impact Receivables Management
• Innovative Recovery
• Integras Capital Recovery LLC
• Javitch Block
• JHPDE Finance 1 LLC
• JP Receivables Management Partners
• JPMCB card
• Kenneth Eisen and Associates
• KeyBank student loans
• Kinum
• Kirschenbaum, Phillips & Levy P.C.
• KLS Financial Services
• Kramer & Frank
• Lakeside Collection
• Lending Club
• Lincoln and Morgan Kabbage
• Linebarger Goggan Blair & Sampson LLP
• Lockhart Collection Agency
• LJ Ross Associates
• LTD Collections
• Malcolm S. Gerald and Associates
• Malen & Associates
• Mandarich Law Group
• Mannbracken
• Marcam Associates
• MARS Inc. Collections
• MBA Law
• MCA Management Company
• McCarthy, Burgess & Wolff
• Meade & Associates
• Medicredit
• Mercantile Adjustment Bureau
• Merchants Credit Association
• MGM Collections
• Michael J Adams PC
• Midland Funding LLC
• Mid-South Adjustment
• Monarch Recovery
• Monterey Financial
• Moss Law Firm
• Mountain Land Collections
• MRS Associates
• MRS BPO
• MSW Capital LLC
• Mullooly, Jeffrey, Rooney & Flynn
• Nathan and Nathan PC
• National Collegiate Trust
• National Credit Adjusters
• National Credit Care
• National Credit Systems
• National Enterprise Systems
• National Recovery Agency
• National Recovery Solutions
• Nationstar
• Nationwide Credit
• Nationwide Recovery Services
• Nationwide Recovery Systems
• NCEP LLC
• NCO Financial Systems Incorporated
• North American Recovery
• Northland Group
• Northstar Capital Acquisition
• Northstar Location Services
• NPAS
• NRC Collection Agency
• Oliver Adjustment Company
• Oliphant Financial, LLC
• Oportun
• P&B Capital Group
• PCB Collections Agency
• Palisades Collection LLC
• Pallida LLC
• Paragon Contracting Services
• Paragon Revenue Group
• Payday Loan Debt Collectors
• Pendrick Capital Partners
• Penn Credit
• Perdue Brandon
• Persolve LLC
• Phillips & Cohen Associates
• Phoenix Financial Services
• Pioneer Credit Recovery
• PMAB LLC
• PRA Group, Inc.
• Pressler, Felt & Warshaw LLP
• Prestige Services, Inc.
• Prince Parker and Associates
• ProCollect
• Professional Finance Company
• Progressive Management Systems
• Provest Law
• PYOD LLC
• Quaternary Collection Agency
• RAB Collection Agency
• Rash Curtis and Associates
• Radius Global SOL
• Radius Global Solutions
• Rawlings Company
• Razor Capital
• Real Time Resolutions
• Receivables Performance Management
• Regents and Associates
• Reliant Capital Solutions
• RentGrow
• Resurgent
• Resurgent Capital Services and LVNV Funding
• Revco Solutions
• Revenue Enterprises LLC
• Revenue Group
• RGS Financial, Inc.
• RMP LLC in Court
• RMP Services
• RS Clark and Associates
• RSIEH
• RSIEH
• RTR Financial Services
• Rubin & Rothman
• Salander Enterprises LLC
• Samara Portfolio Management
• SCA Collections
• Scott Parnell and Associates
• Second Round Collections
• Second Round Sub LLC
• Selip & Stylianou LLP
• Sequium Asset Solutions
• Sessoms and Rogers
• Sherman Acquisition
• Sherman Financial Group
• SIMM Associates
• Source Receivables Management
• Southern Management Systems
• Southwest Credit Group
• Spire Recovery Solutions
• SRS Company
• Stark Collection Agency
• State Collection Service
• Stenger and Stenger
• Stillman Law Office
• Summit Account Resolution
• Sunrise Credit Services
• Superlative RM Debt Collector
• Suttell and Hammer
• Synergetic Communication
• Synerprise Consulting
• The Law Office of Michael J Scott
• Trellis Company
• Troy Capital
• TRS Recovery Services
• TrueAccord
• Tulsa Teachers Credit Union
• UCB Collection
• UHG 1, LLC
• Unifin
• Unifin Debt Collector
• Unifund
• Universal Credit Services
• US Bank Collections
• USAA collections
• USCB America
• Valentine and Kebartas
• Valley Servicing
• Vance & Huffman LLC
• Van Ru Credit Corporation
• Velo Law Office
• Velocity Investments
• Viking Client Services
• Wakefield and Associates
• Waypoint Resource Group
• WCTCB
• Weinberg and Associates
• Weltman, Weinberg & Reis
• Westwood Funding
• Williams and Fudge
• Wilshire Consumer Credit
• Wolpoff & Abramson
• Worldwide Asset Purchasing
• www.AutomotiveCredit.com
• Zarzaur & Schwartz
• Zwicker & Associates

Resolve your debt with your creditor

Some creditors, banks, and lenders have an internal collections department. If they come after you for a debt, Solosuit can still help you respond and resolve the debt. Here’s a list of guides on how to resolve debt with different creditors.

• American Express; American Express – Debt Collection
• Bank of America
• Barclay
• Best Buy Credit Card
• Capital One
• Chase
• Credit One Bank
• Old Navy Credit Card
• PayPal Synchrony Card
• Regional Finance
• Retailers National Bank
• Reunion Student Loan Finance Corporation
• SYNCB/PPEXTR
• Synchrony Bank
• Synchrony Walmart Card
• Target National Bank
• Webbank
• Wells Fargo
• Can I Pay My Original Creditor Instead of a Debt Collection Agency?
• Can I Settle a Debt with the Original Creditor?

Settle your medical debt

Having a health challenge is stressful, but dealing medical debt on top of it is overwhelming. Here are some resources on how to manage medical debt.

• Am I Responsible for My Spouse's Medical Debt?
• Do I Need a Lawyer for Medical Bills?
• Do I Need a Lawyer to Fight Medical Bill Debt?
• Does Bankruptcy Clear Medical Debt?
• How Much Do Collection Agencies Pay for Medical Debt?
• How to Find Medical Debt Forgiveness Programs
• Is There a Statute of Limitations on Medical Bills?
• Medical Debt Statute of Limitations by State
• Summoned to Court for Medical Bills — What Do I Do?
• Summoned to Court for Medical Bills? What to Do Next

Guides on arbitration

If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.

Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.

• How Arbitration Works
• How to Find an Arbitration Clause in Your Credit Agreement
• How to Make a Motion to Compel Arbitration
• How to Make a Motion to Compel Arbitration in Florida
• How to Make a Motion to Compel Arbitration Without an Attorney
• How Credit Card Arbitration Works
• Motion to Compel Arbitration in California
• Sample Motion to Compel Arbitration

Stop calls from debt collectors

Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.

• 1-800-390-7584
• 800-289-8004
• 800-955-6600
• 8009556600
• 877-366-0169
• 877-591-0747
• 800-278-2420
• 800-604-0064
• 800-846-6406
• 877-317-0948
• 888-899-4332
• 888-912-7925
• 202-367-9070
• 502-267-7522

Federal debt collection laws can protect you

Knowing your rights makes it easier to stand up for your rights. Below, we’ve compiled all our articles on federal debt collection laws that protect you from unfair practices.

• 15 USC 1692 Explained
• Does the Fair Credit Reporting Act Work in Florida?
• FDCPA Violations List
• How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)
• How to Make a Fair Debt Collection Practices Act Demand Letter
• How to Submit a Transunion Dispute
• How to Submit an Equifax Dispute
• How to Submit an Experian Dispute
• What Debt Collectors Cannot Do — FDCPA Explained
• What Does Account Information Disputed by Consumer Meets FCRA Requirements Mean?
• What does “meets FCRA requirements” mean?
• What does FCRA stand for?
• What is the Consumer Credit Protection Act