What should you check while choosing debt management company

Debt management can be an effective way to pay off your debts. However, before enrolling into a debt management program, you need to ensure that you’re placing your trust and your finances in the right hands.

Questions to be asked before enrolling in a DMP

You always want to go for the best debt management program in the hope of getting out of debt soon. But, how to choose a good company that offers professional debt management services. What if the company you were working with shuts down? Ask the following questions to the representative of the company before you choose any:

1. What services do they offer?

Check out if the debt management company provides you an initial free counseling session and help you develop a personalized plan to solve your money problems . Avoid them if they just push a debt management plan upon you.

2. Are they licensed to offer their services in your state?

In many states, licensing is required to offer services like debt management, credit counseling etc. Don't work with such an organization that is not doing business as per the state laws.

3. Do they offer free information?

Avoid such organizations that ask for money just to let you know the nature of their services.

4. Will you have a writing agreement?

Never commit to participate in a debt management program over telephone. Get all the promises in writing and read them thoroughly before signing them.

5. Are other clients satisfied with the services?

Check out with your state Attorney General, Better Business Bureau (BBB) and local consumer protection agency to see if there are any complaints registered against the company. If there are any, ask the representative of the company about that.

6. What are the fees? Is there any upfront fee?

Before getting enrolled, ask about the price quote in writing. Moreover, check if the company demands upfront fees. If they demand any, look elsewhere for help.

7. Do they keep personal information of the clients confidential?

If you're working with a debt management company, you have to provide them with your most sensitive financial information. It should be the responsibility of the company to safeguard the information and prevent misuse.

Finances should always be dealt with carefully. Any mistake or negligence on your part may worsen your financial situation. For this reason, take a detailed look at your individual situation and seek financial counseling, before deciding on your course of action.

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