Why Debt Settlement Agencies Continue to Flourish in Today’s Economy
If you are in over your head in credit card debt, and you don’t know where to turn, you may consider a debt settlement agency. They have become increasingly popular over the last year or two because of the millions of Americans struggling to pay their bills.
Many Americans have lost their jobs, exhausted their savings and have begun living off credit in order to get along. However, as this solution is only temporary, at best, many individuals find themselves in serious financial straits and with more credit card debt than they know what to do with.
Avoiding Bankruptcy
Throughout all of this mess, many Americans want to avoid bankruptcy at all costs; which is why debt settlement seems to appealing. They are often looking for a quick and easy way to clear their debt without filing for bankruptcy.
The process of debt settlement seems pretty straightforward: the consumer contacts the debt settlement company who, in turn, makes deals with the consumer’s creditors to repay a portion of their debt. The consumer then begins making payments to the debt settlement company who, in turn, pays off the creditors.
But is this the best solution?
Avoiding Scams and Fraud
Many times, consumers find themselves paying significant fees to debt settlement agencies who do nothing more than act as a third party to pay on the debt. Even worse, many debt settlement agencies take the money and run, never paying off the debt and leaving the consumers in more of a mess than they started with.
Although there are certainly upfront debt settlement agencies that do their job, there are just as many that do not. Your best option is to avoid using a debt settlement agency and instead turn to nonprofit debt counseling services.
Make sure that the debt counseling service that you use has a strong history and a positive reputation. Check the company’s credentials and follow up with a search with the Better Business Bureau.
Remember: you should never have to pay a fee for consumer credit counseling services, as they are generally nonprofit companies who help you manage and pay off your debt, without filing for bankruptcy.
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