Usclarity.com Pricing

Understanding the cost of any financial service is paramount, and Usclarity.com is quite upfront about its pricing model.

Unlike many services that might obscure fees, Usclarity.com details its performance-based fee structure, which aims to align its success with that of its clients.

Understanding the Performance-Based Fee Model

Usclarity.com employs a performance-based fee structure, meaning clients are not charged for the service until a successful settlement is reached on their enrolled debts.

This model aims to assure clients that the company is motivated to achieve positive outcomes.

• No Upfront Charges: A significant advantage is that Usclarity.com does not charge any fees at the outset of the program. This protects clients who are already in financial distress from incurring additional costs before any tangible results are achieved. This model is generally preferred by consumer advocacy groups over upfront fee models.
• Fee Triggered by Settlement: The service fee is only charged “until we reach a settlement on your enrolled debt.” This means that if Usclarity.com is unable to settle any of your debts, you would not be charged their service fee for those specific debts.
• Percentage of Original Debt: The fee is calculated as “25% of your original debt amount.” It is crucial for clients to understand this distinction. For example, if you enroll $20,000 in unsecured debt, the service fee will be $5,000 (25% of $20,000), regardless of whether they manage to settle it for $10,000 or $15,000.
• Fee Integration into Payments: The website states, “We budget this service fee into your monthly dedicated account payments, so you don’t have to worry about making any extra payments.” This means a portion of the deposits you make into your dedicated savings account will eventually go towards this fee, once a settlement is secured.
• Variability by State: A disclaimer mentions that “fees may vary by state.” This is a critical detail, as debt settlement regulations and allowable fees can differ significantly across U.S. states. Prospective clients should confirm the exact fee structure applicable to their state during the consultation.

How Fees Are Paid

The mechanism for fee payment is integrated into the client’s dedicated savings account, which provides a layer of security and transparency as Usclarity.com does not directly receive funds from the client’s bank account for its services until the settlement is finalized.

• Client Deposits: Clients are required to make regular, agreed-upon deposits into their own FDIC-insured trust account, managed by a third-party firm. These deposits accumulate funds for both the eventual debt settlements and Usclarity.com’s service fees.
• Funds Controlled by Client: The emphasis is on client control: “you control your funds, and none of your funds can be used without your permission.” This implies that the client must authorize the release of funds for settlement and the associated service fee.
• Release Upon Settlement: Once a settlement agreement is reached with a creditor for a specific enrolled debt, the corresponding portion of the funds from the dedicated account is disbursed to the creditor, and Usclarity.com’s 25% fee for that particular debt is released to them.
• No Direct Billing: The statement “you won’t be making monthly payments to us. Instead, you’ll be making deposits into your own savings account” clearly delineates the payment process, highlighting the indirect nature of fee collection from the client’s perspective.
• Transparent Accounting: While not explicitly detailed, the use of a third-party trust account implies that clients will receive statements from this third party, allowing them to track deposits, disbursements, and fee allocations.

Potential Additional Costs and Considerations

While the service fee is transparent, individuals entering debt settlement should be aware of other potential financial impacts or indirect costs that are not part of Usclarity.com’s direct fees.

• Accruing Interest and Fees from Creditors: During the period when clients reduce or stop payments to build up settlement funds, creditors may continue to charge interest, late fees, and penalties. These amounts can increase the total debt owed before settlement.
• Tax Implications: Settled debt (the amount forgiven by creditors) might be considered taxable income by the IRS. Usclarity.com explicitly states, “Please consult with a licensed tax professional for tax consequences,” indicating this is a significant consideration.
• Lawsuit Costs: If a creditor decides to sue, clients may incur legal costs, as Usclarity.com does not provide legal services. This can be an unexpected and substantial expense.
• Credit Repair Costs: After the debt settlement process, clients might need to invest in credit repair services or tools to expedite the recovery of their credit score, which would be an additional expense.
• Impact on Future Borrowing: While not a direct cost, the negative impact on credit scores can lead to higher interest rates on future loans or difficulty obtaining financing, representing an indirect long-term financial cost.

What to Expect from usclarity.com