Step-by-step instructions to pick the best debt settlement company
Updated: • 4 min read
Ever seen that ad which promises to save you from a financial storm through debt settlement program? Well, these ads may fill your heart with a hope for a debt free life but it would be a mistake to believe them without doing any homework. Remember, nothing is as simple as it seems to be. If you’re really thinking about approaching a debt settlement company, then start your prep work right now.
If you don’t find an honest debt settlement company, then you could enter into a bigger financial storm in the future.
Step-by-step directions to choose the best debt settlement company
There is no shortcut to spot the best debt settlement company in town. However, there are a few pieces of advice that may help you discover a credible company and these are:
- Check if there’s any upfront fee: Advance fees are not legal anymore. In fact, as per the new FTC guidelines, debt settlement companies can charge fees only after they have successfully negotiated or settled at least one of your credit card or other forms of unsecured debts.
- Ask for a written agreement: This is a must. Only a fake or a fraudulent debt settlement company won’t give you a written agreement. And even if you do get a written agreement, don’t sign it promptly. Go through each and every section of the agreement. Make sure you understand every point. If you don’t understand all the points, throw questions at the debt negotiator. Seal the deal only when you get all the correct answers of your questions.
- Compute the amount to pay: Usually, settlement companies will charge a fee on the amount they’ve negotiated. But there’s a limit on the percentage they can charge. Find out how much other companies are charging for fees. Once you get the figure, your next job will be to compare the fees and choose a debt reduction company charging a small amount.
- Look for complaints: The higher the number of complaints against a particular debt settlement company, the worse for you. There would be hardly any company without any complaints. So, complaints are normal. But if the number of complaints is really excessive in comparison to the time they have been in the industry, then beware. Also, check the type of complaints that are registered against the company. This would give you a fair idea.
- Inquire about accessibility rights: A legal debt settlement company will follow a transparent work methodology. It will do all the negotiations on your behalf and at the same time will give you updates from time to time. They will also give you the access to the dedicated account created to settle your debts.
- No Questions Asked Refund Policy: Only a confident debt negotiation company has a refund policy. A company which is only focused on enrolling people will not give this policy since they’re hardly interested in having satisfied clients.
- Go through our checklist: The best way to find an honest debt settlement company is to go through our checklist. You can compare any debt settlement company with OVLG and find out the best one. You can even download the checklist and rate a company on your own.
- Get a second opinion: It is always good to get a second opinion about the company before putting down your signature on the agreement letter. And the best way to get an honest opinion about the company is to go through the client testimonials. Most online debt settlement companies (the notable ones at least) have a separate section on client reviews in their websites. You can read those reviews. If you can’t find one, then simply type the name of the debt negotiation company in search engine and add the term ‘reviews’. You’ll get tons of resources.
- Ask if they’re affiliated: A good debt settlement company will be affiliated with The Association of Settlement Companies (TASC) or State Bar Association. Any credible company will try to follow all the guidelines and be registered with these agencies.
Debt settlement
The term ‘non-profit’ is enough to gain your trust. But not all companies are non-profit or reputable. Rather, a lot of companies claim to be non-profit just to manipulate you. So, beware. Check if they have received a 501 C (3) certificate from the IRS. Besides, compare their fee structure with that of the for-profit companies.
Questions you must ask 1. Ask if they settle secured debts?Reason - Secured debts can’t be settled. If a company promises to settle secured debts, then it is surely a scam.
2. Ask how will they take to protect your information?Reason - Confidentiality is important and crucial especially when you want to protect your financial information from everyone.
Final recommendation
If you’re really in financial trouble, then understand the negotiation process first. You can even call at (800)-530-OVLG to solve your queries. Once you get a clear idea, start looking for a good debt negotiation company.
