Debt Relief

Overview

When life takes a sharp turn for the worst, financial problems start to mount and pretty quickly the entire situation feels like a dangerous snowball rolling downhill.
Sudden unemployment, an unexpected medical emergency, shopping addiction, a costly divorce, the death of a beloved spouse, or living beyond one’s financial means are all common circumstances whereby debt starts to build up.

Dealing with such a crisis is very difficult, as there is no quick and easy formula that can miraculously solve everything instantly.
In addition, this complex situation may result in a whole host of negative side-effects for a person’s life: from serious difficulties to obtaining credit, renting an apartment, or getting a new job to personal suffering and pain, physical and mental health issues, strained relationships, and much more.

Debt relief providers help alleviate some of the burdens of mounting debt.
Their solutions may come in many different forms that range from partial loan forgiveness, debt consolidation, and debt management plans (DMP) to government-backed programs or other alternative strategies.

For those that want to get on a debt-free path, there are several main options:

• Credit Counseling – Guidance, education, and support on the basic principles of issues such as money, consumer credit, debt management and budgeting, usually provided by non-profit organizations.
• Debt Consolidation – A solution that combines multiple payments from different creditors, such as credit card bills, home loans or other loans, into a single easy-to-manage monthly payment, ideally at a reduced interest rate.
• Debt Settlement – A service provider negotiates with the customer’s creditors on his or her behalf. This helps to settle the existing debts for a lower overall amount.
• Debt Management – A DMP is a formal agreement between a debtor, a credit counseling agency, and creditors that helps to manage payments more effectively.
  The debtor agrees to make a single, regular payment to the counseling agency, which administers and distributes this money among creditors on an agreed-upon schedule.
• Bankruptcy – The final resort for managing debt.

Consumer Tips: How to Remain Safe and Avoid Debt Relief Scams Online

Just like any other field that involves consumers who struggle with credit card debt or other unsecured debt and commercial financial services, the debt relief sector also has its fair share of scammers, fraudsters and cybercriminals that operate online and look for potential victims.

Scammers use a variety of illegal, unethical or other dishonest ways to take advantage of people who are desperate to get out of debt, conning them out of their money.

Some hide behind supposed non-profit status, charge upfront fees illegally, or make false promises regarding their ability to decrease or even totally eliminate the customer’s debt.
Others provide no service at all and simply take the money and disappear while late fees, interest, and substantial penalties pile up as customers wait on relief.

Taking the following steps will help you find credible and reliable companies and handle your debt in a safe way:

Do Not Believe Unrealistic Promises

Be extremely skeptical and cautious about “guarantees” to erase your debt, have it completely forgiven, or settle it for a promised percentage reduction.
This is impossible.

Investigate the Debt Relief Company’s BBB Record

Check the company’s record on the Better Business Bureau’s website.
This information will help you evaluate whether it’s a legitimate business that deserves your money and trust or if you need to look elsewhere.

Look for current BBB rating, customer reviews, complaints, warnings and alerts on their business profile.
In addition, learn how long it has been in business – a potential indicator of experience and reputation.

If the business is not even listed with the BBB, this is a very bad sign.
On the other hand, if the company is certified as a BBB Accredited Business, it’s an important positive signal.

Pay Close Attention to Red Flags

Learn how to better protect yourself when ordering goods and services on the internet, in order to avoid scammers and keep safe in general.
Knowing how to check if a website is legitimate or not is the first line of defense.