Typing the keywords “debt settlement firm,” or, “debt settlement lawyer,” or simply, “debt settlement” into an Internet search engine will provide you with more websites than you could possibly peruse. There are thousands, upon thousands, of companies and firms out there offering to solve your debt problems. And because the industry is unregulated, there is no simple way to determine if a company is credible or not. So how do you sift through them all to find the one that is right for you?

Debt Settlement Debt Reduction Eliminate Debt

Naturally, there is no easy answer, but there are a few key things to look for to sort out the reputable firms and companies from the scams.

For example, check if the company you are considering is a member of the Better Business Bureau (BBB) and the chamber of commerce. Often if the company or firm is a member of these, it will advertise it on its website, flyers, or in its office.

Along the same line, check how long the debt settlement company or firm has been in business. The longer it’s been around, the more experience it has, the stronger its relationships are with the creditors and banks you owe money to, and the more credible it is.

Also, make sure the plan they offer you will have you paying off your debt within two years. A longer time period means you will be paying more in interest, and you are much more likely to be sued by creditors.

Make sure the company or firm has a thorough understanding of your debt situation before they approve you because not all types of debt can be settled or negotiated.

Finally, make sure that it is easy to get a hold of your company or firm. If communication is difficult in the early stages of setting up a debt settlement, imagine how stressful that could become if problems arise!

Honest, reliable, and hardworking firms and companies are out there, just remember it might take some research to find them.

Debt Settlement - How can I avoid being scammed?

Debt settlement will only work if you are with a good, reputable company. Because the industry is unregulated, you must beware. Here are some telltale signs of a scam:

1) They represent that this will not harm your credit, or that it is better for your credit than a bankruptcy. This is false. Your credit rating will be negatively affected. There is no doubt about this. (Any program other than paying your debts in full, on time, will have a negative impact on your credit). However, if you are behind on your bills, your credit may already be bad. But, since our program is designed to have you out of debt soon, your debt to income ratio will improve significantly and you may be able to get new credit. At the end of your debt settlement program, we give all our clients a packet on how to rebuild your credit.

There is also an excellent book on rebuilding credit by Steven Snyder called Credit After Bankruptcy. Although it applies to post bankruptcy credit rebuilding, most if not all of the principles described in the book work for rebuilding credit regardless of your situation. We highly recommend the book.

2) They will accept monthly payments and settle your debt over 3-5 years. This will simply not work, and it is not in your best interest for 2 reasons. First, if you wait more than about 18 months, you will almost surely be sued by multiple creditors. With the low payments you are making, you will not have the funds in your account to settle with all of them. The pressure will be too great and you will probably end up filing bankruptcy for protection. All the money you have paid to your debt settlement company will have been wasted! Second, you cannot begin to rebuild your credit until you are done settling all of your debts. If you wait 3-5 years, you are just prolonging your poor credit rating.

The reason this is essentially a scam is because they make all of their money on the front end and they may not care if you end up leaving the program. They get paid a bunch of money and do basically nothing.

3) They ask for a high up front fee, or a fee that is paid primarily in the first year. This is a huge signal and it goes hand in hand with taking low payments over a longer period. If they charge a large up front fee, such as $2000 or more, than you can be fairly sure they will not care if make through the program. We saw one client who paid $2500 down, and then $300 per month for a year. The first year of payments were to go to the settlement firms fee as well! She paid about $6000 and then was overwhelmed by lawsuits. (The firm did settle one debt for her). She ended up filing for bankruptcy and lost her $6000.

Our up front fee is a reasonable fee, based on the number of creditors you have. It usually ranges from $600-$1000.

4)They state that they can settle your debts at 25-40 cents on the dollar. Although settlements like these can happen, they are extremely rare. You should expect settlements of approximately 60-75 cents on the dollar, including settlement fees. Beware if you get promises of unrealistically low settlements. If you expect to settle all your debts at 25 cents on the dollar, you are probably going to be disappointed. We have the experience to get you the lowest settlement value available.

Our goal is to give you accurate information so that you can make a sound financial decision. We will be frank with you about your options, and we will give you excellent customer service. If you are looking for firm with the highest level of experience, and one that can get you out of debt fast, give us a call or fill out our online consultation form now.

Debt Settlement Services - Our Debt Settlement Company will help you settle your debt with ease.