| Debt consolidation services can provide a valuable | | | | with a cashiers check or money order, look for |
| service by lowering your interest rate with creditors, | | | | another program. |
| enabling you to pay off your unsecured loans and bills | | | | Offering Debt Negotiation Programs |
| in a short period. However, there are companies that | | | | You should also be suspicious of companies that |
| would rather take your money than help you. To | | | | pressure you to use other programs, such as debt |
| avoid such scams, watch out for the following. | | | | negotiations. First of all, debt negotiations or |
| Low Monthly Payment Claims | | | | settlements usually will not improve your credit |
| While debt consolidation companies can lower your | | | | situation. Secondly, you will be charge high fees for |
| interest rate which might lower your payments, they | | | | something you can do on your own. And finally, |
| cannot negotiate lower minimum payments. Creditors | | | | companies who specialize in debt consolidation have |
| no longer accept smaller payments since 2004, not | | | | no incentive to see you flounder with your finances, |
| even for "hardship" cases. One trick companies use is | | | | unlike those offering other services. When you are |
| to lure customers in with a low quote, only to jack | | | | looking for a debt consolidation program, ask |
| up the required payment in a months time. By that | | | | questions about the program, fees, and amount of |
| time you have already paid out fees, which arent | | | | time to repay your bills. |
| refundable. | | | | Take advantage of the internet and research several |
| Upfront Fees | | | | different agencies. Since debt and bill consolidation |
| Another shady practice is to charge large upfront | | | | varies with the number of accounts involved, you |
| fees when a company is claiming non-profit status. | | | | should expect a phone consultation before you |
| Legitimate companies will either charge a small | | | | receive any quotes. With your quote you should |
| monthly fee between $14 to $69, depending on the | | | | receive detailed answers, including pay off dates for |
| number of accounts. The other fee structure is to | | | | each account and exact fees. And if you feel |
| charge a reasonable fee for each account handled; | | | | uncomfortable with the agency, feel free to walk |
| typically for-profit companies use this structure. If | | | | away. A consultation is not a commitment on your |
| you are being asked to pay thousands, especially | | | | part. |