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Choosing a debt management company |
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Choosing a debt management solution isn't a decision that can or should be made with ease.
There are companies that promise they can relieve your debts if you send them money, but just how trustworthy are these companies?
How do you know that the company you choose can follow through on its promise?
When you are choosing a debt management company, there are several key things to watch out for
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Vague details about how your payments will be used |
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If you're sending money to a debt management company every month, then you need to know what the money will be used for.
If the company won’t give you this information, take your money and your business elsewhere.
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The absence of a contract or written agreement |
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Don't make a commitment with any debt management company based solely on a phone conversation.
Request a written copy of the terms and conditions of the service before you agree and especially before you make any payments.
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Promises to remove negative information from your credit history |
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No debt management company has the authority or the ability to change information on your credit report. Guarantees and promises to do this are completely false. All any debt management company can do is attempt to negotiate with your creditors to have negative information removed. This, you can do yourself.
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No backing of a law firm |
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With a legal service it provides you the legal backing of an attorney.
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Beware of the non-profit companies |
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Investigations have uncovered big salaries for nonprofit executives as well as some rather dubious relationships between nonprofit counseling agencies and for-profit businesses, including payment-processing companies.
In a few cases, the same person ran the counseling agency and the for-profit business. In other instances, a nonprofit agency's executive was steering business to a for-profit company run by a relative or crony.
So regardless of what all those warm and fuzzy ads might say, not every nonprofit counseling agency has your best interest at heart. Consumers immediately let their guard down and think they're all good guys, and they could be funneling money to a related,
profit-making company.
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