The non profit debt consolidation services term may be a vague term to you. As the name implies, you probably guess it is nonprofit services that consolidates debts. But what exactly is a not for profit debt consolidation service?
A non profit debt consolidation company bails out debtors who are deeply in debt. They exist to help you save or repair your credit rating and keep you from foreclosure or bankruptcy. These services range from lengthening the pay-off term to reducing the rate of interest so that you can reduce the amount you are paying to your creditors each month.
“Non profit” is not equal to free service. In addition to one monthly payment to cover all of your debts you will have to pay them a monthly service fee. They will see that all of your payments are made on time and you will receive monthly statements from your creditors and a monthly statement from the debt consolidation service.
Nonprofit Debt Consolidation Company Scams
While it is worth the fee to get out and stay out of debt, as with any business you need to beware of scams. In recent years, the Federal Trade Commission (FTC) has slapped fines on many fraudulent companies masquerading as non-profit debt consolidation organizations.
The following are claimed made by “nonprofit” consolidation companies: nonprofit service, reduce debt, better than bankruptcy, and no impact on credit rating. Those claimed oftentimes are only tempting promises and customers, who fall for it, are in for a disappointment.
So, ponder carefully on the claims made by these companies. Do they sound too good to be true? If so, they probably are. Just because they are nonprofit doesn’t mean they’re not earning from their clients. These companies can easily overstate their operating expenses to make their financial report reflects illusionary break-even margins.
Legitimate Non Profit Debt Consolidation Services
Are there truly legitimate debt consolidation companies? Yes, but they’re rare.
If you want to find good agencies make sure you are dealing with a reputable company that belongs to the Better Business Bureau. This institution will be able to tell you whether a debt consolidation company is for real or not by the number of consumer complaints filed against the debt consolidation firm you plan to contact.
When you approach a reputable company they will give you qualified debt advisers, who will guide you appropriately. They offer educational programs to teach you the way credit works and how you can make it work for you. Only the non profit debt consolidation services that are equipped with the experts who know your creditors will ultimately be beneficial to you.