They usually charge those fees even if they don’t get any settlements. Many people will already be struggling when hear an ad for “debt settlement” schemes that claim to get clients “debt free” in a very short time. Most of these schemes fail and consumers find themselves in even deeper debt.
Many debt settlement companies will urge you to stop paying your debts. This can make a bad problem even worse and you are now gambling that your creditors will agree to settle. If a creditor refuses to settle you could be worse off than before. Even then you are not done as they may report the debt reduction to the IRS and you may have to claim it as income.
Look out for any of the following:
- Promises that unsecured debts can be paid off for pennies on the dollar
- Requiring substantial monthly service fees and demand payment of a percentage of what they have supposedly saved you
- Tell you to stop making payments or to stop communicating with your creditors
- Suggest that there is only a small likelihood that you will be sued by creditors
- State that they can remove accurate negative information from your credit report
If you are struggling to make ends meet. Before paying a debt settlement company contact us and come in for a Free Confidential Consultation.
You’ve got nothing to lose but the debt.
Call Now to schedule a FREE consultation with an experienced bankruptcy attorney!
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Posted December 2012|Updated 01/14/2014