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What You Need to Know to Avoid a Debt Relief Scam – Amir Articles

Debt relief is a viable strategy, you just need to be knowledgeable. Read about way to Avoid Debt Relief Scam and much more.


When debt has you in a financial pit that deepens by the month, offers to miraculously clear all your obligations in a short time for a bit of upfront cash can seem tantalizing. But beware: the debt relief industry is pockmarked with companies that are more interested in profiting than relieving you of debt.

Debt relief is a viable strategy, you just need to be knowledgeable. Here’s what you need to know to avoid a debt relief scam.

The Good 

Credible debt relief firms can help you get back in the black. They can provide advice about money management and budgeting, negotiate and “settle” with creditors, or create a savings plan for ultimately paying down your debt.

There are multiple kinds of debt relief, and scores of consumers have been helped. If you go with debt settlement, for instance, you just need to pick a reputable company. They do exist. There are no known reports of Freedom Debt Relief scams, for example, and this is a company that’s been around since 2002.

The Bad

On the other hand, scam companies make easy “guarantees” they can’t back up or ask you to pay them up front before any debt is settled. Other firms will take your cash and skedaddle, leaving you in worse shape than before. You may even get strung along, making payments, and listening to “promises” – while your outstanding debt grows.

Many companies that are on the take focus on student loan debt, which has exploded to $1.6 trillion. You may have even gotten one of these bogus offers to settle your debt for pennies on the dollar, while it collects advance and ongoing fees.

Warning Signs That You’re Dealing with a Bad Actor

  • You’re asked to pay fees before any fees are settled, which is against the law.
  • You’re given guarantees that your balances can be eliminated or lowered by a certain amount within a specific timeframe.
  • You’re told to cease communicating with your creditors.
  • You’re unable to get info from a company about its services unless you give it financial data such as credit card numbers and balances.

What You Can Do to Avoid Being Scammed

  1. If you’re considering a certain company, search online and contact your state’s attorney general and local consumer protection agency to see if there have been complaints.
  2. Familiarize yourself with disclosure requirements for debt settlement firms. Such companies, for example, are required to explain all fees and conditions, and give you an idea of how long it will take to resolve your debt.
  3. Be wary of breathless declarations of “a new government program” or new law that will lower, forgive, or erase your liabilities. 

What You Shouldn’t Do to Avoid Being Scammed

  1. Don’t pay any fees up front, even if they’re cloaked in “donation” or “voluntary contribution.”
  2. Don’t believe the hype. Not a single firm can guarantee it will pare your debt by a specific amount or block collection calls and lawsuits.
  3. Don’t allow a firm to enroll you in a debt settlement program without having assessed your financial situation.
  4. Don’t believe that a company can get negative info on your credit report removed. If the information is correct, it’ll live on your report for at least seven years.

Now you know what you need to know to avoid a debt relief scam — and move forward with a debt settlement company that can help you change your life.

Make your move today.

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Red Note: 30 September 2022

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