Consumers are struggling with growing debt in the face of a still troubled economy, making debt settlement one of the only options for relief in many situations. Debt settlement can provide the quickest way to get out of debt while avoiding the severely damaged credit that results from bankruptcy. Many consumers who wish to use debt settlement don’t know how to select the right company to meet their needs. Fortunately, the question of what to look for in a debt settlement company can be answered quickly.
Investigate the Company
It’s always important to perform proper background checking on any financial company before doing business with them. One place to check is the Better Business Bureau (BBB), although they have issued a statement that they will downgrade any company that offers debt settlement. A good internet search can also be revealing if customer reviews are available. A good debt settlement company should be in business for at least five years, as many client cases take at least three years to resolve.
Membership in TASC
TASC, or the Association of Settlement Companies, is a non-profit organization that was founded to promote good business practices in the debt relief industry. TASC creates a network of settlement companies that must demonstrate compliance with business standards and the organization’s bylaws. Because the goal of TASC is to protect consumers from unfair business practices, it’s important to select only a debt settlement company that is a current member of TASC.
The First Meeting
The first meeting with any debt relief company reveals a lot. On the matter of what to look for in a debt settlement company, select a company that commits a lot of time in the first meeting to understanding goals and the client’s current financial situation. Any company that rushes clients during the beginning interview probably doesn’t have their full attention or the ability to completely understand the client’s debt problems. The first interview should include an in-depth analysis of all outstanding debt, including balances and interest rates, along with a clear plan.
Reasonable Fees
Although any company that helps a consumer arrange for debt settlements will charge a fee, the fee should always be reasonable. Non-profit organizations should not charge an up-front consultation fee higher than $75. On the other hand, many laws prohibit for-profit companies from charging any up-front fee at all. Typically, it’s a good idea to avoid any company that charges a monthly fee drawn directly from the customer’s bank account as well.
Selecting the right debt relief organization comes down to knowing what to look for in a debt settlement company. Although some are unreliable, debt settlements in general can help consumers save thousands of dollars and reduce debt in a fraction of the time it would normally take. By selecting a company that has good standing in the community, takes time to understand their financial situation fully, and charges only reasonable fees, a consumer can find protection against the more unreliable companies.
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