You see and hear the advertisements every day from so called “debt settlement” companies:
- Are you drowning in debt? Call XYZ Company. We can help you.
- We know the secrets that credit card companies don’t want you to know about.
- We can set up a payment plan that will slash your minimum payments and reduce your total debt burden.
- We have successfully eliminated $100 million of debt for our customers.
- We are a non-profit debt consolidation company.
- Restore your good credit in as little as 90 days.
As an attorney with over 20 years in the bankruptcy business, I can tell you that the debt consolidation is kind of like the credit repair business. While there are a few honest players, there are also far too many scamsters looking for a desperate consumer who is looking for an easy solution to a big problem.
Some of these debt negotiation companies have ended up in the same boat as Ameridebt, which has been shut down by the Federal Trade Commission. Other companies appear and reappear using different trade names and as everchanging corporate entities in various states.
The allure of “debt consolidation” or “debt negotiation” companies is easy to understand. No one likes to deal directly with debt collectors and it may be very tempting to push this burden to someone else. Unfortunately, most debt negotiation services fall into the “if it sounds too good to be true, it probably is” category.
Don’t give up hope, however. There are some proven, legitimate and free techniques that you can use to deal with debt collectors that can help you avoid getting stressed out and becoming a victim to the intimidation psychology used by bill collectors. I’ll get into that in my next post on this blog.
