If your financial situation has you convinced debt settlement is your best option, finding a debt relief program that works for you should be your next move. While there are a few individuals out there looking to make a fast buck with little concern for your wellbeing, fortunately they’re easy to spot. Here’s what to look for in a good debt settlement company.
The best companies take their time and explain every aspect of the debt settlement process, including the pitfalls. By the way, one of the biggest ones to consider is your credit score could be lower as a result of using this strategy. The good news is it could come back once the program is complete, if you keep your record clean.
Several organizations serve as monitors for the industry. These include the American Fair Credit Council (AFCC), the International Association of Professional Debt Arbitrators (IAPDA), and the Better Business Bureau (BBB). If the company you’re considering using is acknowledged positively by these entities, you’re likely to be in good hands. But don’t just take a firm’s word for it, do your background research to find out if they are for yourself.
Reasonable Fees/Low Minimum Debt
In most cases, the fee structure is predicated upon the amount of debt you’re facing. For this reason, companies looking to maximize fees won’t accept clients with debts less than $10,000. Meanwhile, reputable firms tend to accept $7,500 as the baseline debt amount. By the way, truly legitimate firms won’t ask you for a penny until they’ve negotiated a settlement on your behalf—and you’ve paid the creditor.
Years In Business
The longer a company has been around, the more likely it is to already have some sort of relationship with your creditor(s). This can be a real advantage. Older firms also have a greater regard for their reputation. As an example, the Freedom Debt Relief program has been around since 2002 with strong success. A company like this isn’t likely to engage in shady practices with so much time invested in building its business.
Timelines/Types of Debt
In most cases, only unsecured debts like credit cards, medical bills and retail charge accounts are eligible for debt settlement. If a company is saying it can work with secured debt like mortgages and car loans, odds are they’re not on the up and up.
Yes, there are occasional exceptions, but by and large it’s rare for secured debt to be negotiated down in this fashion. Timelines generally run between two and four years—though it could be sooner if your resources permit. However, anyone promising an instant settlement solution is probably planning to instantly take your money and leave you wondering what happened.
Readily Available Customer Service
The best debt settlement companies have a solid customer service team of responsive, informative and pleasant people. Ideally, you’ll get an individual counselor with whom you can consult. If this service isn’t available, you should at least be able to get someone on the phone that can review your account and give you a satisfactory accounting of where you are in the process.
Possession of these seven attributes should be integral to the makeup of any company you consider when you’re finding a debt relief program that works for you. It’s important to realize that debt settlement isn’t right for everyone. However, debt consolidation could be, if you can afford to make more than minimum payments. You may even qualify for a lower rate than you’re currently pay; although this requires a high credit score.
In short, if you’re struggling with more than $7,500 in the red, debt settlement could be your best option. Do your homework to find what works for you!