Article 113 Debt Settlement Companies, Don't Settle With Them - Part 3
Debt settlement companies is part of a series of four articles to help the debtors watch out so they will not go deeper in debt when dealing with them. We know for sure that when things get out of hand, it makes sense to hand over the reins but we have to do it the right way.
Do It Yourself or Pay Through Nonprofit Credit Counseling
It is better to get help from nonprofit credit counselors who are reputable or you can do it yourself. The first thing to do is to find out how much you really owe by looking at the balances and the due dates in the monthly statements. Then call the creditors to talk about the options of repayment. Many of them will be willing to agree on reduced payments.
Ask the creditors if they could give lower interest or a more affordable payment terms. Tell them you want to work something out with them and that you cannot make the payments due to unforeseen circumstance and request if they could suspend the payments for awhile.
If you cannot do this yourself, find a nonprofit credit counseling service near you to get advice on how to pay off the debts without a bankruptcy and a settlement. The resource box at the end of the article will take you to the page where you can find a nonprofit counseling service. A reputable company will be able to help you create a budget and set up a repayment plan.
Creditors will be willing to agree to a reduced repayment plan with credible companies. You will then deposit money into the account with the credit counseling service which will go to pay the creditors. The nonprofit credit counseling company might charge you only $20.
Then after you have paid your debt, they will not make you pay them a percentage of your debt. Rather they will get a percentage of payment from the creditors themselves. That is why a nonprofit counseling service is where you go to get good advice as to how you can pay off your debt.
A counselor will assess your financial situation for free. If you cannot pay off your debt, they will walk you through the next steps. They will usually advice you to work with the lenders to reduce the amount you owe. You can do this as well as any debt settlement companies.
Paying Through Any Debt Settlement Companies
When you want to pay through a settlement company, the important thing is to get the best one right at the start. There are many companies out there that help pay off the debt but there are some that are only interested in their commissions. It is a good thing there are ways to find the best ones.
The first thing to do is to check out the company by doing a bit of research. Find out how they stand with the Better Business Bureau. Then go to the Association Of Independent Consumer Credit Counseling Agencies and look for a firm that works in the state where you live.
Get a written explanation of the services that will be provided. This should include how much the service is going to cost altogether and when are they are going to require their fees. Ask also how their service will affect your credit history and how long will it take for them to settle your debt. Are they licensed? This is another tough question you have to ask.
Make sure to take some precaution. Call the state attorney office and ask about the state law as to the amount and/or timing of fees. Make sure you read the contract including the fine print. If the contract does not mention the promises they tell you, do not sign up. Instead look for another company that will only charge you the fee after settling your debt.
Finally, it is time to face the music. Before signing up with any debt settlement companies, accept that you have to make changes in your life. Know that you have to create a plan so that you will never be in this trouble again. Discipline will be the key to succeed. That said, let us find the best debt settlement company. How do we get the best debt settlement company? Well, there are guidelines set forth by the Federal Trade Commission. Follow the guidelines and you will be operating on a safer mode. It is good to point out here that an unsecured service from an unsecured debt settlement offers an alternative to bankruptcy but it is not strictly regulated.
Watch for Part 4 where you will have information on the guidelines set forth by the Federal Trade Commission to help select the right company and what it is doing to protect the consumers from shady firms when they decide to get help from the debt settlement companies.
Abstract: Debt settlement companies may be able to help with that slippery road slip- sliding into debt. This article will show how to get the right one so the slide into debt will not lead to more problems.