Debt Work Solutions
Northpark Tax Resolution
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Frequently Asked Questions:

Q: Who qualifies for Debt Settlement?
Debt Work Solutions program is for anyone facing financial hardship such as being late on your payments, struggling to keep up with the minimum monthly payments, or have little or no ability to pay back your debt and are facing bankruptcy. Debt Settlement is the most cost-effective option for people facing hardships including but not limited to:

  • Reduced Income
  • Job loss
  • Divorce
  • Poor money management
  • Underemployment
  • Medical Expenses

Q. How is the service fee paid, are they paid upfront?
Instead of our fees being charged upfront, they are withdrawn each month from you new settlement account. Typically our fees are spread out over a period of 4-12 months. All fees are included in the one monthly savings amount upon enrollment.

Q. Should I put all of my credit cards in the program?
Most of our clients hold onto one card with the lowest balance that can be quickly paid down to zero for emergencies. However the program will generally be more effective if you enroll all of your high balance (greater than $750) credit card accounts. It can become more difficult for us to negotiate with your creditors if they see that you are negotiating on some accounts but not others.

Q. Who controls the bank account where I am saving funds for creditors?
You do. The bank account is set up in your name and the money in the account is your money. The reason why we recommend keeping it in a new account that is separate from your existing bank accounts is that this separation dramatically increases the probability of success in Debt Work Solutions program. Debt Work Solutions fees are deducted from this account each month, according to the Agreement that you sign with us. The accumulated savings in the account are owned by you.

Q. How does this affect my credit?
Not making the required payments to your creditor could end up being reported to consumer reporting agencies as a late, delinquent, charged-off or past due balance. This is true whether or not you have enrolled in a Debt Settlement Plan. Our goal is to get you out of debt for the lowest cost, without declaring bankruptcy and once you are out of debt, we will be able to refer you to a reputable credit repair organization if you desire. Please note, Debt Work Solutions is not a credit repair organization.

Q. Will I receive phone calls from collectors?
There are federal and state laws designed to protect you from creditor harassment. However, the fact is that most of our clients experience some collection calls. Our goal is to get your creditors to call us and not you when they want to ask for money, and we will work with you minimize any calls that get through to you. In addition, we will work with you to make sure violators of collection laws, including the Fair Debt Collection Practices Act (FDCPA) are appropriately handled. Our team of lawyers will send out Cease and Desist letters to harassing creditors.

Q. Will I owe taxes on my forgiven debt?
The IRS generally considers a forgiven debt as taxable income, so at the end of the year, they will expect taxes to be paid on the settlement. However, the IRS has a form (Form 982) available for certain hardship situations that may exempt you from this tax. It is advised that you contact a tax advisor to discuss this option.

Q. Could I negotiate on my own?
Yes you can. You can also do your own taxes and repair your own car, but most people choose to seek help. Most people prefer to leave these tasks to experienced people who are specialists in the lines of work. Our team of debt negotiation specialists have only one job - negotiating reductions on our clients’ unsecured debts, each and every day of the week. Our knowledge and experience puts us in the best position to stand up to your creditors and fight for the best settlement possible.

Q. Do you begin negotiating with my creditors right away?
Except when dealing with certain difficult creditors, we generally contact your creditors when our debt arbitrators feel that its in the clients best interest to let them know that we have Limited Power of Attorney and to request that future collection calls come to us and not you. The actual negotiation activity is typically very limited until you have saved up enough in your settlement account to make reasonable offers to your creditors. Most (but not all) creditors do not want to spend time negotiating an account unless they know there are funds available. The first settlement typically happens in month 5 to 6 of a client’s program (this varies greatly and depends on your monthly savings amount and the number of creditors you have enrolled in the program as well as the balance of each individual account). In some instances it may take more than 6 months before the first settlement is reached.

Q. Will my debts be sent to a law firm? Will this result in a lawsuit?
Creditors do have the right to send debts to third party collection agencies and/or law firms in order to collect a debt. If this happens, we will continue to negotiate on your account and will treat the debt as a priority creditor. Based on our actual experience, it is a small percentage of cases on which lawsuits are actually filed. When this does happen, usually the purpose of the lawsuit is to force a settlement. We will continue to negotiate to settle the debt, although the settlement percentages are often higher than typical “non-legal” settlements. If a lawsuit is filed before you have saved up enough funds to negotiate a settlement, we will seek to resolve the account by putting it on a long term payment plan for 100% of the balance. Please note, we are not a law firm and cannot provide legal advice or legal representation.

Q. Do you guarantee that you settle all of my debts for a certain percentage?
Every case is based on your financial situation, and there is no guarantee how the negotiations will wind up. The success of our negotiations is highly dependent on your ability to save a specified amount each and every month you are in the program so you can generate a positive cash flow.



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Northpark Tax Resolution Affiliate
3365 E Miraloma Ave Ste 206,
Anaheim, CA 92806

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