If you’re drowning in credit card debt, CreditAssociates claims they can reduce what you owe by around 50% before fees. But is it worth the credit score hit and lengthy timeline? Here’s what you need to know.
The Bottom Line Up Front
CreditAssociates is a legitimate debt settlement company that negotiates with creditors to reduce your total debt. Clients who complete the program typically settle for around 50% of their debt owed, though after fees, the actual savings average closer to 30%. The process takes 24 to 36 months to complete, and your credit score will take a significant hit during this time.
Best for: People with $10,000+ in unsecured debt facing genuine financial hardship who can’t qualify for other relief options.
Not ideal for: Anyone needing credit in the next 2-3 years or those who can afford minimum payments.
How CreditAssociates Works
The process is straightforward. After a free consultation, you stop paying creditors directly. Instead, you make monthly deposits into a special savings account, which are typically much lower than your current credit card payments.
Once enough money accumulates, CreditAssociates negotiates lump-sum settlements with your creditors. You only pay their fee when a settlement is successfully reached and you approve it.
Important: You won’t make any payments toward your enrolled debts while you’re in the program. This creates leverage for negotiations but destroys your credit score in the process.
What It Costs
CreditAssociates charges 25 percent of enrolled debt, not the settled amount. If you enroll with $20,000 in debt and they settle it for $10,000, you’ll pay $5,000 in fees (25% of $20,000).
No upfront fees. You only pay when settlements are reached. If they can’t negotiate a settlement, you owe nothing for that debt.
Hidden costs to consider:
- Late fees and interest accumulating during the program
- Potential tax liability on forgiven debt
- Credit score damage lasting years
Who Qualifies?
You need to meet three requirements:
- Minimum $10,000 in unsecured debt (credit cards, medical bills, personal loans)
- Proof of financial hardship (can’t afford current payments)
- Live in one of 42 supported states (not available in Colorado, Connecticut, Minnesota, Maryland, New Jersey, Pennsylvania, Vermont, or Wyoming)
Types of Debt They Handle
Eligible:
- Credit card debt
- Medical bills
- Personal loans
- Business debts
- Private student loans
- Collections accounts
Not eligible:
- Mortgages
- Auto loans
- Federal student loans
- IRS debt
- Court judgments
The Credit Score Reality Check
Let’s be blunt: your credit will suffer while you work through and recover from your financial difficulties. Missed payments get reported to credit bureaus immediately. Expect your score to drop 100+ points.
Settled accounts remain on your credit report for seven years. This impacts your ability to get approved for mortgages, car loans, or even rental applications.
Customer Experience: The Good and Bad
CreditAssociates has a 4.9 out of 5 rating on Trustpilot based on over 20,000 reviews. Customers consistently praise the patient, knowledgeable consultants who explain the process clearly.
CreditAssociates has an A+ Better Business Bureau rating with generally positive feedback.
Common complaints:
- Persistent follow-up calls after initial consultation
- Longer timelines than expected
- Creditors refusing to settle
- Frustration when credit scores drop
How CreditAssociates Compares
| Company | Fee | Minimum Debt | Timeline | BBB Rating |
| CreditAssociates | 25% of enrolled debt | $10,000 | 24-36 months | A+ |
| National Debt Relief | 15-25% of enrolled debt | $7,500 | 24-48 months | A+ |
| Freedom Debt Relief | 15-25% + monthly fees | $7,500 | 24-48 months | A+ |
CreditAssociates charges slightly higher fees but offers straightforward service with no monthly account fees.
Alternatives Worth Considering
Before committing to debt settlement, explore these options:
Nonprofit credit counseling: Free debt management plans with lower fees and less credit damage. Check the National Foundation for Credit Counseling.
Balance transfer credit cards: 0% APR for 15-21 months if your credit is still decent. Can save thousands in interest.
Debt consolidation loans: Fixed rates around 8-12% for good credit. One payment preserved the credit score.
Bankruptcy: If you owe $50,000+, Chapter 7 or 13 bankruptcy might discharge more debt faster.
Frequently Asked Questions
Is CreditAssociates a scam?
No. CreditAssociates is accredited by the Better Business Bureau, accredited by the American Association for Debt Resolution, and certified by the International Association of Professional Debt Arbitrators. They’re a legitimate company that’s been operating since 2007.
Will I be sued during the program?
Possibly. Creditors can still sue you for unpaid debts during settlement negotiations. CreditAssociates cannot prevent lawsuits, though they become less likely once settlements are reached.
What happens to forgiven debt at tax time?
The IRS may count forgiven debt as taxable income. If $8,000 is forgiven, you might owe taxes on that amount. Consult a tax professional to understand your liability.
Can I pick which debts to enroll?
Yes. You’re not required to enroll all your debts. However, incurring more debt often leads to better negotiating leverage.
How quickly will I see results?
First settlements typically occur 4-6 months after you’ve saved enough in your dedicated account. Full completion takes 24-36 months on average.
What if I can’t afford the monthly payment?
CreditAssociates can adjust your payment plan. However, lower monthly deposits mean slower progress and potentially less leverage for negotiations.
Should You Use CreditAssociates?
CreditAssociates makes sense if you’re genuinely unable to afford minimum payments and have at least $10,000 in unsecured debt. The straightforward approach and strong customer reviews indicate they deliver on promises.
However, the 25% fee, credit score destruction, and 2-3 year timeline make this a last-resort option. Try balance transfers, debt consolidation, or nonprofit credit counseling first.
If those won’t work and bankruptcy seems too extreme, CreditAssociates offers a legitimate path to debt reduction with transparent pricing and solid support.
Ready to explore your debt relief options? Get a free, no-obligation consultation with CreditAssociates to see if you qualify and how much you could save. Takes 15 minutes and won’t affect your credit score.
Disclaimer: Debt settlement seriously damages credit scores and may result in tax liability. This article provides educational information only and should not be considered financial advice. Consult with a qualified financial advisor or credit counselor about your specific situation.
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