The Problem With Unreputable Debt Settlement Companies August 5, 2007
Posted by janey in : unsecured loans , trackbackFor many people seeking debt relief one of the most sensible options is debt settlement. Most people at this point will look and try to find a service out there that can help them settle their debts. However, as with the credit counseling industry there are good reputable companies, and then not so reputable companies. Most of these bad debt settlement companies didn’t start off bad or have any intentions on scamming people. So what ends up happening to make these companies turn “bad�
It usually stems from two things. The first being that they do not truly qualify clients to make sure debt settlement is a good choice for their situation. Many settlement companies have counselors working off of a strait commission, which can sometimes make these counselors push a little to hard to bring clients on. The first step in any debt settlement arrangement is to make sure that the prospective client is truly qualified for debt settlement. So what qualifies someone? Two things, one is the type of debt that you have, and the second is whether you can budget getting out of debt within the correct time frame. Many counselors do not ensure that they can even negotiate on their clients debts and still go ahead and enroll them. So when it comes time to negotiate and nothing can be done this leaves clients very unhappy. Some companies won’t even refund people their fee at this point either which leads to even more problems for the company.
The second major thing that can lead companies astray is being to “top heavyâ€. Meaning there are too many clients and not enough people in client services to service the clients accounts. All to many companies will hire 30-40 or more counselors so that they can enroll as many clients as possible. This would be fine if they made sure they had 50-75 or more people in clients services to give each client the time and attention needed to do the best possible job. Unfortunately there are a lot of companies that do not have sufficient people in client services.
Do not get all bummed out after reading this though. There are many companies out there that are outstanding and have great services and can get the right job done. It falls onto the person looking for help to find the right company. Use common sense when looking for a company. Check the BBB. Also check your state’s attorney general to make sure the company is not under investigation.
And last but not least make sure you have a good gut feeling about the company you are enrolling with.
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