When struggling with large amounts of credit card debt, trying to get yourself out of it can feel a lot like being stuck on a hamster wheel. You’re making monthly payments and trying to move forward, but the balances don’t appear to be getting any smaller. So, when a random letter, email, phone call, or ad appears and promises to settle your debt for pennies on the dollar in just a few short months, it can be easy to accept without thinking twice. Before you know it, you’ve paid a large amount in fees and program costs with nothing to show.
Unfortunately, the number of scams continues to climb while legitimate debt relief companies work tirelessly to combat misinformation about the debt settlement process. Scammers have become so well-versed that it can be difficult to tell the difference between a company that will help you and one that will hurt you. As a highly-rated, legitimate debt relief company, we at ACCS want to make sure every consumer struggling with debt is aware of the telltale signs of a debt relief scam:
The Telltale Signs of a Scam
The Company Reaches Out to You
If your introduction to the company is through a piece of direct mail or an unsolicited robocall, then steer clear. According to the FTC, legitimate debt settlement organizations won’t cold-call you or send you mail to offer you their services.
The Company Asks for Fees Upfront
A major red flag is when a debt relief company charges fees upfront or requests a lump sum to settle your debt before providing services or achieving settlements with your creditors. Be equally wary of companies who frame upfront fees as “voluntary contributions”: these scammers often trick struggling consumers into paying large fees and then offer them very little help—if they provide any aid at all.
The Company Is Aggressive
Calling the number of a debt resolution company and hearing a real person on the other end can fill you with a sense of relief. Surely if I’m talking to an actual company representative, they have to be credible! While this may be a good sign, if the individual on the other end begins to be aggressive or pushy with you to sign up for their services, then you may be dealing with a scam. Real debt settlement agencies will be patient with you, go over your financial situation, and lay out all your options. At no point should you feel pressured to begin a debt settlement program.
The Company Guarantees Unbelievable Results
Many fraudulent debt relief organizations will talk a big game about being able to guarantee incredible results. Whether that be claiming they can eliminate your debt by 70% or more, or get it paid off in a matter of just a few months, know that these promises are unrealistic.
The Company Offers a “One Size Fits All” Program
Have you ever ordered a “one size fits all” piece of clothing, only for it to arrive and look like you’re wearing an ill-fitted garbage bag? Just as you deserve clothing that fits your body type, your debt deserves a plan tailored to tackle your unique situation. When a company says that their program works for everyone, alarm bells should sound in your head. Reputable debt resolution companies will work with you to create a plan that suits your individual needs and give you an affordable monthly program payment based on your budget.
How Can I Avoid a Scam?
Do Your Homework
Given that most scams rely on being anonymous, covert, and nearly untraceable, a little bit of research into their contact information can go a long way. A well-designed website doesn’t mean an organization is trustworthy. If a company has no physical address, no telephone numbers, or provides only a P.O. box address, chances are you’ve run into a scam. It’s also vital to search online for positive reviews and testimonials from real clients of the company and check in with credible websites such as the Better Business Bureau. Lastly, checking in with your state’s consumer protection agencies and the attorney general’s office for complaints and lawsuits will give you a good insight into whether or not you can trust this company.
Look for Accreditations
While certifications and accreditations are meaningful in any industry, debt settlement companies must fulfill several requirements to receive them. These requirements make the companies that have these accreditations extremely safe bets for you and your debt. When browsing a potential debt relief organization’s site, be on the lookout for accreditations such as IAPDA which demonstrates that their staff is held to a standard of excellence.
Know the Legal Requirements
Under FTC guidelines, there are specific legal requirements that all debt resolution companies must fulfill. In particular, they must thoroughly explain all conditions and fees for their programs and services, spell out the risks of stopping payments to your creditors, and estimate the length of time it will take to settle each of your debts. A debt settlement company that doesn’t clearly define these conditions and fees may be one to avoid.
Get Everything in Writing
When you’re struggling with debt and an agent on the phone tells you that their company can magically solve your debt woes with a settlement that sounds like music to your ears it can be easy to believe them. However, a verbal agreement is not binding. What once was a sweet deal can turn sour when hidden fees and poor service come into the mix. A legitimate debt relief company will lay all terms and fees out in writing for you.
Stay in the Loop
Let’s say that you’re already working with a debt settlement company, but something feels off. You haven’t heard any updates from them, but you’re still making monthly payments. In cases like this, get in contact with your creditors. Ask them point-blank if the company you hired is making payments on your behalf. If the answer is yes, then find out exactly how much the company is paying. If the installments are less than what you’re paying, or if they aren’t making payments at all, you know you’re being scammed. Real debt resolution organizations will keep you in the loop.
If It’s Too Good to Be True, It Likely Is
Don’t be swayed by empty promises of becoming debt-free cleanly and quickly. If it feels too good to be true, then it likely is. Instead of falling for a would-be debt savior, find yourself a debt partner: an organization that works with you every step of your journey to becoming debt-free!
At ACCS, we pride ourselves on our highly-rated program that has helped our clients get out of debt faster and for less owed in a way that suits them best. To discover what our program can do for you at no cost or obligation, request a Custom Debt Relief Plan today!