If you’re struggling with high amounts of debt, debt relief services like Freedom Debt Relief and ClearOne Advantage offer potential solutions. But how do you know which one is right for your situation?
This comprehensive guide compares Freedom Debt Relief and ClearOne Advantage head-to-head. We’ll analyze the pros, cons, features, and reputation of each to help you make an informed decision.
A Brief Comparison Table
| Aspects | Freedom Debt Relief | ClearOne Advantage |
| Service | Debt settlement | Debt consolidation |
| Overview | Negotiates lower payoffs on your behalf | Consolidates debts into one loan |
| Time to Complete | 2-4 years typically | 3-5 years |
| Upfront Costs | Fees to enroll | Interest on new loan |
| Ongoing Costs | Monthly service fees | Monthly loan payment |
| Ideal For | Those with poor credit or high balances | Borrowers with good credit |
| Credit Impact | Hurts credit initially, then improves | Drops score at first, then builds credit |
| Debt Reduction | Settles debt for 25-50% less | Maintains total debts owed |
| Savings | From lower negotiated balances | Lower interest rates on consolidation loan |
| Cancellation | Keep fees paid | Must repay consolidation loan |
Overview of Freedom Debt Relief
Freedom Debt Relief is one of the largest and best-known debt settlement companies in the industry. Here’s an introduction to their services:
- One of the first debt settlement companies, founded in 2002
- Ranked the top debt settlement provider by independent sites
- Over 750,000 clients helped settle billions in debt
- Negotiates with creditors to lower your balances
- Requires setting aside funds in dedicated account
- Charges fees as a percentage of enrolled debt
- All negotiations handled on your behalf
The debt settlement program from Freedom involves opening a dedicated account, stopping payments to creditors, and letting Freedom negotiate reduced payoff amounts. This is best suited to those with debt they can’t pay off quickly.
Overview of ClearOne Advantage
ClearOne Advantage takes a different approach as a debt consolidation program. Here’s a quick look at their services:
- Founded in 2011 in California
- Not a household name but positive online reviews
- Over 45,000 people assisted with managing debt
- Consolidates debts into one lower payment
- Provides loans to pay off your balances
- Ongoing credit counseling and payments
- Fees for setup and monthly service
With ClearOne Advantage, you get a debt consolidation loan to pay off your debts and consolidate into one payment. This can provide monthly savings but means taking on another loan.
Freedom Debt Relief Pros
Freedom Debt Relief has several advantages that make them one of the top debt settlement companies:
High Success Rate Settling Debt
Freedom Debt Relief boasts one of the best track records in the debt settlement industry, settling over $15 billion in debt since 2002. Their expertise negotiating achieves an excellent success rate.
Lower Your Debt Balances
The debt settlement program can reduce your total debt balance by anywhere from 25% to 50% typically. This is powerful savings compared to just maintaining minimum payments.
Stop Collection Calls and Lawsuits
Once in the program, Freedom handles all communication with creditors. This can finally stop the daily collection calls and lawsuit threats from creditors.
Avoid Bankruptcy
For many clients, Freedom’s debt reduction program helps them avoid having to pursue bankruptcy. Settling debt can prevent the need for this damaging credit event.
Large Company with Long History
With two decades of experience and hundreds of thousands of clients, Freedom Debt Relief has a well-tested system that produces results. Their scale gives confidence in their services.
ClearOne Advantage Pros
Enrolling in ClearOne Advantage’s debt management program has benefits like:
Lower Interest Rates
ClearOne seeks to reduce the interest rates on your credit cards and loans to provide more savings each month. This can save thousands in interest.
Consolidate Into One Payment
Rather than multiple payments at different times, ClearOne consolidates all your debts into one lower monthly payment for simplicity.
Save Money Each Month
That single debt payment is structured to be lower than what you currently pay across all debts. This frees up monthly cash flow.
Ongoing Credit Counseling
You get support from a personal financial counselor who can provide budgeting help, assess finances, and answer questions.
Improve Credit Scores
By staying current on payments, credit scores often gradually improve in the program as debt balances decline.
Freedom Debt Relief Cons
However, Freedom Debt Relief has some potential drawbacks to note:
Damage to Credit Score Short Term
Missed payments and settlement activity will likely hurt your credit, especially in the first 12-24 months. Scores gradually recover after debts are settled.
No Guarantee of Settlement
While they have a good track record, there is no guarantee Freedom will settle all your debts. Lenders must voluntarily agree to settlements.
Upfront and Ongoing Fees
You’ll pay an upfront fee as well as ongoing monthly fees. If you leave the program early, Freedom keeps fees already paid.
Tax Implications on Settled Debt
If lenders forgive $600 or more of debt, that can be considered taxable income. You may owe taxes on the forgiven amount.
Must Have Funds to Settle
To settle debts, you need available funds either in savings or provided by family. Without this, debt settlement may not be realistic.
Also Watch This Review Video:
ClearOne Advantage Cons
Some potential downsides of ClearOne Advantage include:
Service Fees and Interest
You’ll pay program fees as well as interest on the new consolidation loan. This can reduce net savings compared to just paying debts yourself.
Damage to Credit Initially
The new loan creates a hard credit check and higher debt utilization, likely dropping scores at first before improving over time.
Long Repayment Time
It can take 3-5 years to repay the consolidation loan. The debt relief is not immediate like with debt settlement.
Lender Must Approve You
ClearOne cannot guarantee a loan offer since an outside lender must approve you based on eligibility requirements.
Potential Additional Debt
Since ClearOne pays off your debts and rolls them into a loan, you take on additional debt instead of reducing it like in debt settlement.
Also Read: Comparison Between National Debt Relief And Accredited Debt Relief
Frequently Asked Questions (FAQs)
ClearOne Advantage receives positive reviews and is accredited with the BBB. Their debt management program can effectively consolidate your high interest debts into one payment at a lower monthly cost. However, it’s critical to check that you qualify for a low enough interest rate on the consolidation loan to provide actual savings.
Freedom Debt Relief is one of the top ranked debt settlement services. For consumers with unsecured debt they can’t pay off quickly, using Freedom can potentially settle debts for 25-50% less than owed. This provides major savings. However, it does damage credit initially before scores recover.
ClearOne Advantage provides a debt consolidation loan to pay off your credit cards and other unsecured debts, rolls them into one balance, and lets you repay that at a lower monthly payment over 3-5 years. This simplifies payments and aims to save on interest.
The most effective debt solution depends on your financial situation: Debt management like ClearOne works best for those with good credit and steady income. Debt settlement through companies like Freedom is ideal for those with poor credit scores or large debts they can’t pay quickly. Debt consolidation loans make sense for borrowers with equity available to take a home loan. Bankruptcy quickly eliminates debt but causes long term damage. DIY debt payoff is the cheapest option but requires financial discipline. Compare personalized quotes to see which debt relief strategy makes the most sense for your situation.
The Verdict
Overall, Freedom Debt Relief is better for most consumers needing urgent debt reduction. Their debt settlement program can slash balances owed and provide immediate relief. This helps avoid bankruptcy or years of just maintaining minimum payments.
However, ClearOne Advantage can be a smarter choice for borrowers who need to consolidate debts into one payment and have good enough credit to qualify for a low interest rate loan. Their debt management plan helps organize finances but won’t reduce what you owe.
Think about your specific financial situation and debt relief goals when choosing between Freedom Debt Relief and ClearOne Advantage. Their services appeal to different needs, so review the pros and cons carefully.