Recovering from a Contractor Gone Wrong…Without Bankruptcy

Recovering from a Contractor Gone Wrong…Without Bankruptcy
BY Aimee Bennett
Jul 20, 2022
Key Takeaways:
  • Pamela L. encountered debt problems after a botched home renovation
  • She turned to Freedom Debt Relief for assistance and to avoid resorting to bankruptcy
  • Pamela says she appreciated the way Freedom Debt Relief explained the process and worked with her along the way

When Pamela L. set out to build an addition on her house, she had no idea she would end up with a shaky foundation, sub-standard plumbing and an unlivable home. Nor did she realize that in redoing all the work, she’d end up with no retirement savings, maxed-out credit cards and a mountain of debt.

She chose the Freedom Debt Relief program to help her pay what she could without resorting to bankruptcy. “I have worked as hard as I could to keep my Beacon [credit score] up, to keep my credit established…I knew if I went in bankruptcy, it would mess all that up,” Pamela said.

Bankruptcy, she added, “is so final. It seems like it lingers on your record forever.”

With the Freedom Debt Relief program, “I knew my Beacon [credit score] would go down…but it would eventually come back — and it wouldn’t be on my record that I actually went into bankruptcy.”

Plus, “it was my debt. Hands down, I feel like if I owe it, then I need to pay it,” Pamela said. So even though she was struggling, she wanted to pay what she could. The Freedom Debt Relief program was a way to get the help she needed.

Pamela noted that the Freedom Debt Relief representatives explained everything about the process up front and said she felt that the monthly payments she made were reasonable. She also appreciated the support she got from Freedom Debt Relief throughout her journey. “You have to stick with the program. I needed that structure. I needed that to help me to focus.”

“It was a long process, but it paid off in the end and saved me a lot of money,” Pamela said.

Today, Pamela says her credit score has recovered, she has completed the work on her home and refinanced her mortgage. “Thank goodness I found Freedom and went this route,” she concludes. “There were little bumps in the road along the way, but all-in-all, it was, for me, the best option. A win-win.”

Debt relief by the numbers

We looked at a sample of data from Freedom Debt Relief of people seeking debt relief during June 2024. This data reveals the diversity of individuals seeking help and provides insights into some of their key characteristics.

Credit utilization and debt relief

How are people using their credit before seeking help? Credit utilization measures how much of a credit line is being used. For example, if you have a credit line of $10,000 and your balance is $3,000, that is a credit utilization of 30%. High credit utilization often signals financial stress. We have looked at people who are seeking debt relief and their credit utilization. (Low credit utilization is 30% or less, medium is between 30% and 50%, high is between 50% and 100%, and very high is over 100%). In June 2024, people seeking debt relief had an average of 81% credit utilization. Here are some interesting numbers:

  • 47% of the people fell into the high utilization bucket.

  • 21% of people used 30% or less of their credit lines.

  • 21% had very high credit utilization.

You don't have to have high credit utilization to look for a debt relief solution. There are a number of solutions for people, whether they have maxed out their credit cards or still have a significant part available.

Tackle Financial Challenges

Don’t let debt overwhelm you. Learn more about debt relief options. They can help you tackle your financial challenges. This is true whether you have high credit card balances or many tradelines. Start your path to recovery with the first step.

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