We understand that debts especially, credit card debts seem to be a major issue for millions of Americans today. The average American has accumulated a whopping credit card balance that is about $6,375, up almost 3 percent from the previous year as per Experian’s annual study that focused on the current state of debt and credit in the United States. Meanwhile, we know that overall credit card debt seems to have reached the highest ever, over $1 trillion in the year 2017, as per a separate report presented by the Federal Reserve.
As per https://www.forbes.com, “So if you are struggling with getting out of debt, clearly you are not alone. Maxed out credit cards, getting new cards, only to max those out and now you have double the debt. Paying the minimum on your cards each month, meaning you are only paying the interest and your card will be paid in 312 months. Terrified to check your credit score, so you don’t.”
There are numerous ways of getting relief from this sorry state of affairs. You may seek debt consolidation since it is very effective and effortless if done by experts. Good debt consolidation companies provide extra expert legal assistance for your convenience.
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Recognize the Signs of a Scam
You must do ample research to identify the right debt consolidation company but you need to be alert and beware of certain red flags discussed below. Any of these red flags could be regarded as a sign that the debt consolidation company is not bothered about focusing on the client’s best interest. Watch out for debt consolidation companies that:
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Charge Upfront Fees
You must know that as per the FTC regulations, there is a ban on any advance fees. This rule prohibits a debt consolidation or even a debt settlement company from collecting any advance fees until they have fulfilled the services promised. Companies do not have the right to earn revenues till they have done what they had promised to their clients. This regulation implies that you could rest assured that a good debt consolidation company would be efficient and would deliver the highest levels of client satisfaction and service. You may visit nationaldebtrelief.com to learn more about debt consolidation reviews.
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Tout Any “Government Program” For Erasing Credit Card Debt
This is an absolute scam as no such programs actually exist.
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Give You a Guarantee to Eliminate All Your Debts
Some highly questionable companies would be making false promises that you could pay off all your existing debts “for pennies on the dollar.” One can never give such guarantees. A legit company would be working hard to deliver the best possible results for its clientele. A legit company would always be transparent about its entire procedure and the outcomes.
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Claim that They Would Be Stopping All Lawsuits & Collection Calls
If you have been defaulting for quite some time and have accumulated a substantial amount of debts, your creditor may transfer your case to the collection agency. They would be making collection calls and harassing you. Creditors may use the lawsuit threat. A legit debt consolidation company would not claim that they could magically prevent collection calls or legal action. A competent company would be there for you every step of the way until the debt consolidation process is complete. They would never claim that they could easily prevent strict legal action or even the collector calls.
Attributes of a Legit Debt Consolidation Company
It is important to work in partnership with a legitimate debt consolidation company to get the best results and to stay out of lawsuits.
Ensure that It Is a Nonprofit Agency
A number of things could be implied by debt consolidation. There are a host of shady operators that promise to repair your credit or help you effectively out of debt. Your first proactive step would be to ensure that you are dealing with a legitimate agency by verifying their status. Are they a nonprofit organization? If yes, you could rely on them as nonprofits are known to provide far more reliable and seamless debt consolidation services since they do not stand to gain in any way by exploiting you or taking advantage of your ignorance. Verify with the charity regulatory body of your state and make sure that the agency is actually registered as basically a nonprofit organization.
Look for Accreditations by Reputed Trade Associations
You would be finding that there are two reputed trade associations in the credit counseling landscape. They are the NFCC or the National Foundation for Credit Counseling and the FCAA or the Financial Counseling Association of America; they work relentlessly towards developing standards to evaluate best practices within the credit counseling industry. A legit debt consolidation company would be achieving these accreditations by abiding all these existing best practices. The FCAA is a new and small agency in vogue since its inception in 1993 and it is known to maintain a comprehensive directory of all its members online. The NFCC was founded in 1951, and it also maintains a comprehensive directory of all its members online.
Examine BBB Ratings
You must examine the ratings at the BBB or the Better Business Bureau. A renowned agency would be getting an exceptionally high rating and would be accredited by the BBB. The Better Business Bureau is known to be setting the real standards of ethical business practices. Moreover, it helps in maintaining ratings based on precisely how well any business actually abides by all those strict standards. Additionally, the BBB website also acts as a superlative repository for all registered consumer complaints.
Make Sure That the Debt Consolidation Company Is State-Licensed
Many states need the debt consolidation companies to hold a proper license for operating there. You may do your research to see if any such license is necessary for your state. If yes, you must get in touch with the regulatory body responsible for licensing to find out the authenticity of the debt consolidation company and whether it has any such license from the authorities. However, some states such as Maryland and Florida do not necessitate any such license.
Conclusion: A Perfect Understanding of the Existing Debt Laws
The debt consolidation company you are thinking of partnering with must be a legitimate one that understands all the relevant laws pertaining to debt consolidation and debt relief. You would need a debt consolidation company that specializes in debts for safeguarding your legal rights and not in some other irrelevant domain.