Be Sure to Ask These Questions Before You Hire a Debt Negotiation Organization
Questions you should ask a Debt Negotiation Business
Does the Organization have an “A” rating with the Better Business Bureau?
Always verify with the BBB the rating of a Debt Management Business before you select them. Don’t just take the organization’s word for it. Call the BBB and ask about the company.
How Much Does the Assistance Cost and When are the Fees Received?
Most Debt Settlement Companies collect 15% to 20% of your total debt as compensation for their assistance. This compensation is calculated on the amount of debt you have when you enter the program and is received up front. With the company’s upfront payment collected in the first 12 to 18 months, the bulk of what you pay into their service is taken by them as compensation. Once they have received their fee there is no motivation for them to do their job.
In a legitament Debt Consolidation Plan you only pay a small enrollment fee to go into the Service, so what you deposit into the Service is actually put aside and not taken in fees. The settlement fee is based on the amount forgiven by your creditors. This means the fee is based on the amount the organization saves you. The business should only receive a settlement fee once a settlement has been reached. This will allow you to get out of debt much more quickly and gives the business motivation to get you the best possible settlement!
Does the Debt Settlement Organization offer Debt and Credit Counseling?
Most Debt Reduction Companies offer only debt settlement. A bona fide Debt Assistance Company
will give Credit and Debt counseling as well as Debt Consolidation and Debt Settlement Programs. Your Credit Counselor will help you explore all your options so you can decide which service is best for your situation and budget. The organization should not push one service but should help you in choosing the right program for you.
How Long has the Debt Assistance Business Been in the Debt Management Business?
If it is a start up or brand new in the business, the organization will have almost no experience. Always beware of a business that will not provide verification of their experience.
Can the Debt Assistance Company Stop the Credit Card Companies From Calling Me?
No Debt Negotiation Business can ensure they will stop all collector calls. That is simply not possible. Anyone that says they can is not being truthful.
Will The Debt Reduction Businesses be making monthly payments to the Credit Card Companies?
The Creditors are not paid until an acceptable settlement is reached and approved. Therefore, Debt Management Program Businesses do not make monthly payments to the collection agencies. That is simply how the program works. Any Debt Reduction Business telling you otherwise is not being honest.
Can I be sued?
A creditor can always sue you. If you are informed of something else, a red flag has just been raised. The debt relief company is not being truthful.
Will This Hurt my Credit Report?
Inspite of what most people think or believe, all debt reduction services will hurt your credit score. Think about it,you are in debt and are not paying as agreed. The debt settlement service is meant only as a management tool. However once your debt has been settled, your accounts will show a $0 balance and you will begin the process of reestablishing your credit score.
When Will I Receive My First Settlement?
While this varies in every case, your first settlement should be made within the first 12 months from the beginning of your service. More than 12 months is unacceptable and the organization that tells you this is probably not a good match for you.
Where is the Money Kept While I’m Waiting on a Agreement?
This is a very important question. Your funds should always be kept at a third party escrow business that is FDIC insured. Any organization informing you to keep your own money or to send the funds to them is more than likely not right for you. If you want to settle your debt, you must have the money ready to pay the credit card companies when the settlement is reached.
These questions are suggestions. The most important point is to ask many questions and get the right answers to those questions. With your questions fully answered, you can find the Debt Assistance Company Organization that is right for you.
Debt Assistance Program
Debt Consolidation Service
Processing your request, Please wait....
