Avoid Debt Settlement Scams with These Handy Tips

The need for quality debt settlement services continues to expand and this has unfortunately lead to a rash of less that acceptable companies that have tried to cash in on the misery of these desperate people. It can be difficult to avoid debt settlement scams if you have little experience with the industry so this article has some information you should consider when selection a company to help you.

One of the best ways to stay away from debt settlement scams is to educate yourself on the services that they should be delivering. A professional debt settlement company will look at your financial situation, assist you to prepare a budget so that you can accurately determine the amount you can pay per month. They then attempt to negotiate with the companies that you owe money to in an effort to get an outcome that satisfies your debts and allow you to meet the payments.

If a company deviated from this list then you should think twice or you may not be able to avoid debt settlement scams.

Avoid Debt Settlement Scams

Debt Settlement Links

A great way to check out a company is by seeing if they have any links with business or debt professional bodies. They are bodies and associations require bona fide credentials and ongoing professional development which are not areas that scam businesses are able to produce.

One of the top associations is the better business bureau which not only keeps information on all of its members but also makes the information and complaints available to the public. This makes it much easier to avoid debt settlement scams and also allows you to check out what action they have taken when they have received complaints. It is not mandatory to be a member and not being a member does not mean that the company is unreliable.

There are several credit based professional associations and once again while being a member is not mandatory it is not a good sign. There are very few creditable companies that are not a member of one of these associations so to avoid debt settlement scams it is important to check. Some unconscionable companies have claimed that they’re members of these professional groups in an attempt to fool potential clients so it is important to check with professional body if you have any doubts.

  • Check business is registered
  • Check if they are a better business bureau member
  • Check if they have any professional affiliations
  • Verify claimed memberships and associations

Settlement Fees and Charges

One of the most distressing aspects of these scam companies is that they make totally unrealistic promises to people that are desperate. One of the prime indicators that you should avoid debt settlement scam companies is when you are asked to pay an upfront fee. This is not a normal way of conducting debt settlement. Professional debt settlement companies will discuss your situation prepare a budget and have all of the information about your debts before they can even decide if your situation can be helped by debt settlement. They will then commence the negotiation phase and once they have results and a payment plan for the debt then payment will be discussed in line with the contract signed at the beginning of the process.

Fees and charges should be fully disclosed prior to work starting and when and how they will be paid should also be discussed. Reputable companies will fully explain how and when the charges will be implemented and any company that seems to be reluctant to fully disclose all of these charges is best avoided. Being fully informed is the best way to avoid debt settlement scams so if you don’t understand or they won’t answer questions then it is definitely time to leave.

Debt Information

If a company is promising you a solution without even reviewing your debt information then you should be very wary. Not all debt problems can be negotiated to a successful conclusion and some problems are so bad that only bankruptcy is an option. If you are asked to sign up to a debt settlement program and commence payments even before they have contacted a creditor then you know that something is not right.

A good way to avoid debt settlement scams is to look the information that is given to you. Scam companies are trying to always reassure you and frequently give completely different answers to the same question in an attempt to make their solution look as good as possible. All information should be the same from all people in the organization and should not change if the information impacts negatively on your decision to sign up. Scam organizations want you to sign up and want you

  • Are they more interested in signing you up?
  • Have they asked you to sign up before they have checked you debt information and ability to pay?
  • Have they asked you to start paying before they have contacted any of the companies that hold your debt?
  • Are they trying to hide information or give different answers?

If you have answered yes to any of these questions that be very careful!