How to Choose a Debt Relief Service

Working with a reputable debt relief service is a good way to get out of your debt. With huge numbers of companies that offer debt help, though, it is often difficult to find one that offer real help.

Fortunately, the Telemarketing Sales Rule (TSR) now protects consumers from deceptive or abusive practices in the telemarketing of these agencies.

Companies that use telemarketing to contact potential customers are subject to the TSR. The New Rule expands the scope to cover outbound calls placed by the firms and inbound calls placed by consumers in response to advertisements.

Just learn how the new laws regulate debt relief services so you can find a reputable firm to work with.

Types of Debt Relief Services Covered in the New Laws

There are different nonprofit and for-profit organizations that offer debt relief services through telemarketing. These include credit counseling agencies, debt negotiation companies and debt settlement firms. Each of these services has its own types of services and target consumers as well.

Credit counselors are firms that negotiate monthly payment plans with creditors by lowering interest rates or forgiving late fees so debtors can repay the full amount.

Debt negotiation services are companies that promise to reduce debtors’ monthly payments by getting creditors to reduce interest rates or agree to other concessions. And debt settlement companies are ones that say they can settle debts for less than the full balance.

Signs of Reputable Debt Relief Companies

1. No upfront fees. Good debt relief services are paid based on a proportional fee or percentage of savings. They will only charge a fee for services once all these steps are completed: they reach a successful result, both you and your creditor agree with the settlement, alteration or reduction and you have made a payment to your creditor.

2. Clearly disclose all fundamental aspects. Before signing you up a reputable debt relief company will show your the time frame, the cost and all negative consequences. If the agency requires you to set aside funds, they’ll tell you the amount and place them in an insured dedicated account where you can withdraw them without penalty.

3. Make truthful claims. Legitimate debt relief firms have proofs to back their claims, which usually show the results they’ve achieved for previous customers. In calculating the claimed savings they also include those who dropped out of their programs and all debts enrolled by their customers.

4. Train and supervise their employees well. Top debt relief help makes sure all their employees, including commission based (telemarketing) sales staff, are following their rules. They watch their employees carefully so they don’t make false or unsubstantiated claims about their services to potential customers.

5. Carefully choose customers. Debt relief programs aren’t right for everyone so the best debt relief companies have written procedures to make sure that each customer is suitable for their programs. Their rate of success is high because customers who sign up with their program are likely to complete it successfully.

6. Keep open communications with customers. Great debt relief services update their customers on the status of their progress, which include any important communications from creditors, and let customers communicate directly with their creditors as well. They keep records and give customers copies of written documents of any plans.

Now that you know signs of a good debt relief service, just use the above checklist for evaluating companies and programs reviewed here.

How to Choose a Debt Relief Service was last modified: March 27th, 2015 by Paul Sarwana