How to Choose Between Debt Relief Companies

Many debtors agree that working with a debt relief company is a great way to consolidate loans and pay off debt. The problem is that there are thousands of debt relief agencies in the United States and not all of them are reputable. Consumers should choose a debt relief company with care and should be armed with information before making a decision about which agency to trust with their finances. There is a great need for information about which debt reduction agencies are reputable. Here are some questions consumers should answer before making a decision about which company to trust.

What is the Company’s Standing with the Better Business Bureau?

One of the first things a debtor should check when they are researching a company is the company’s reputation with the Better Business Bureau. The BBB is a very reliable source of information and companies that have had many complaints filed against them should be avoided, especially if the complaints have not been resolved.

How Much are the Fees?

Any good company that helps debtors consolidate their debts charges fees, but debtors should avoid companies that charge fees they cannot afford. Debtors shouldn’t expect to pay more than about 15 percent of the amount they owe in fees. Debt settlement is one of the best ways for debtors to avoid bankruptcy and improve their credit score, but the plan will not work if the debtor cannot afford to pay the company’s fees.

Does The Loan Company Ask Questions?

Good debt relief companies ask debtors many questions about their financial situation to determine if they are a good candidate for the debt reduction programs they offer. A person who doesn’t ask detailed questions about the debtor’s financial history and goals probably doesn’t care about helping the debtor improve their financial situation. These companies should be avoided as much as possible. A debt relief specialist is likely to ask questions about each debtor’s recent financial activities and creditors because they are trying to figure out which debt relief program would be best for that debtor’s situation.

Is a Money Back Guarantee offered by the Company?

Companies that are not willing to put their refund policy and the grounds on which they will offer a refund in writing, they are probably not a trustworthy debt settlement company. They are probably not confident in their ability to help the debtor negotiate debt payoff if they are not willing to stand behind their claims. A reputable company that helps debtors settle their debts will not charge debtors fees if they are not able to negotiate with the debtor’s creditors and save the debtor money.

There is no way to tell for sure if a company that specializes in debt relief is the right fit for a certain debtor, but asking questions and taking note of the answers as well as the attitude of each company usually helps debtors eliminate companies that are not a good fit for them. Sometimes debtors have to rely on how they feel about each company if they are choosing between two or three companies that are reputable and meet their needs.

Author’s Bio: Valerie Anne B. Reyes is a freelance writer. She writes guest posts on personal finance websites, particularly those dealing with credit card consolidation, debt settlement, debt reduction and debt consolidation companies.