Beware Of Unethical Debt Settlement Companies

By Author: J.J. Yong
Total Articles: 963
Comment this article

During financial crisis, most of the debtors have chosen debt settlement as their financial solution to overcome their debt issues. They tend to look for professional service providers to assist them. In their point of view, getting the assistance from third party allows them to have more peaceful mind and they don't need to deal with their creditors directly. However, how "professional" are these service providers?

Seriously speaking, there are many unethical companies which aim to grab the money from their clients without having sincere intention to dig the debtors out from debt.

The following are 5 misleading statements provided by the service providers. Make sure you are not being convinced by them.

1) You are able to cut down your total debt up to 80% through an effective debt relief plan.

There is no creditor who is willing to accept the offer up to this extent. In general, the creditors will reject your request directly without any consideration as they don't see your seriousness in settling your debt.

2) You are able to maintain your credit score even you have late payments or missed ...
... payments during the debt negotiation process. The settlement will never hurt your credit rating at all.

This statement is definitely wrong. When a debtor drags his or her payment, the creditors usually report to the major credit bureaus and there is negative impact on the debtor's credit file.

3) You can become debt free within few months

In general, the whole debt negotiation process takes about 2 years time. It is impossible for a person to become debt free within such a short period.

4) It is not necessary to choose a settlement company which is a member of the Association of Settlement Companies (TASC) and the Better Business Bureau (BBB)

It is always advisable to look for reputable service provider. If the company is not the member of the above mentioned bodies, it is good for you to stay away from it. If you don't check the background of the service provider carefully, you stand a higher chance to be trapped by scams.

5) You don't need to pay any single cent for your settlement plan. It is absolutely free.

Almost 99% of the settlement companies gain profit from handling settlement cases, except non profit organizations. Some companies do provide free consultation but they still charge service fees when you sign up their plans. In other words, there is no free lunch in today's business world.

To sum up, knowing the truth about the service providers is important. It is always good if you can handle the debt issues on your own.
For more information about debt settlement companies and online debt settlement, visit DebtSettlementEssentials.com.