Tips On Debt Settlement Companies

The New York State office of the Attorney General web site is a great resource for consumers. The following information was abtained from the site. For more information, please visit: www.nydebthelp.com. Be wary of debt settlement companies that promise to obtain settlements for much less money than consumers owe. Many debt settlement companies misrepresent their typical results and their success rates. Avoid debt settlement companies that require payment in advance of obtaining the promised settlement. Keep in mind that debt settlement plans may not stop creditors from charging interest, late fees, or other penalties on outstanding debts, and do not prevent creditors from bringing collection lawsuits. In addition, failure to make required payments on your debts will negatively affect your credit score. Creditors are under no legal obligation to accept a settlement offer for less than the outstanding balance owed. Only a small number of consumers who enroll in debt settlement plans are able to complete them. Usually, consumers drop out after having paid service fees to the companies without receiving any benefit from their enrollment. Enrollment in a debt settlement plan premised on stopping payments to creditors will likely lead to more frequent and aggressive creditor collection efforts and may result in judgments, wage garnishments, and freezing of bank accounts. Check with the Better Business Bureau to obtain a Reliability Report on a particular debt settlement company and its rating. A wise first step to help resolve an outstanding account is to speak directly to the credit card issuer or other creditor.