Evaluating Debt Settlement Programs

You’ve decided debt relief is the best solution for your growing debt woes. You aren’t sure how to pick a company though, and there are a lot of options to choose from. It’s important for your future to get this right, so here’s what you should know about evaluating debt settlement programs.

What is Debt Settlement?

Also called debt relief, debt settlement is when a company is hired to negotiate with creditors to get them to accept a one-time payment in full of less than what is owed to satisfy a debt. Basically, a good debt company like TurboDebt will be able to slash what you owe, help you skirt bankruptcy, and get you out of debt faster than you could on your own.

Who are Debt Settlement Candidates?

Debt settlement might be a good fit for those whose debt load has become unmanageable, and want to avoid bankruptcy. If you’re simply seeking a reduced payment, debt settlement is not the solution for you.

Selecting a Debt Settlement Program

There is no shortage of debt settlement programs, which is both good and bad news. Unfortunately, the industry has more than its share of scammers, which makes it even more important to know what to look for in a company. Some companies won’t be a good fit for other reasons, including your eligibility for their programs.

Here are areas to home in on when seeking debt relief of this nature.

Eligibility – Be certain the company in which you’re interested handles the type of debt you have. Many debt settlement companies will only accept unsecured debt such as credit cards and medical bills. You also want to be sure you have enough debt; many companies have a minimum debt loads of, say $10,000 to $15,000.

Fees  – While scofflaws abound, it’s illegal for a debt settlement company to ask for fees up front. Turn away from any company that does this. You should also check to see if the company in which you’re interested has cancellation fees.

Accreditation – Particularly in this industry, accreditation is important. Look for membership in The American Fair Credit Council or the International Association of Professional Debt Arbitrators. Such organizations require members to hew to specific standards aimed at helping consumers. You also want a company that has a high rating with the Better Business Bureau.

Customer Service – Check with your state’s attorneys’ general office to see whether complaints have been lodged against the company you’re considering. Also check the Better Business Bureau and the Financial Protection Bureau’s Consumer Complaint Database for grievances.

With the best debt settlement companies, it shouldn’t be hard to find positive online reviews and five-star ratings from satisfied customers. Such companies also have robust websites that offer tools, financial education, and other resources.

Transparency – Turn away from any company that is hesitant to give you information about promised services, fees, etc. The best companies will also inform you that enrollment in debt relief will not shield you from debt collectors or lawsuits and that the process will temporarily affect your credit.

What you don’t want is a fast-talking company that “guarantees” settlements, usually for pennies on the dollar. While debt settlement companies on the whole have successful track records, there are no certainties in negotiations.

In Summary

When it comes to evaluating debt settlement programs, you now have some things to look for. Before putting a call into the company you’re interested in, it’s also a good idea to check out their website for requirements and other pertinent situation.