Non profit debt consolidation agencies charges lower fees than for-profit debt consolidation companies. They charge you fees for their services, which include talking to creditors to negotiate lower monthly payments and disbursing your monthly payment to your creditors so that you only need to make one monthly payment to the firm.
There are many nonprofit debt consolidation organizations that offer various debt management services. If you search debt consolidation on the web, you will find thousands of different companies you could work with. Since there are many scam artists out there to help prevent a potential loss on your part learn how to separate a good company from the bad one.
Bad, Unethical Non Profit Debt Consolidation Companies
As with any other type of business, there are good debt consolidation companies and bad ones. Whereas the good firms will help you get and stay out of debt the bad ones will pocket your monthly payments to fill their own coffers.
If you work with these kinds of agencies there is a chance that your creditors will receive far less than the agreed upon amount or even no money at all. To make matters worse the creditors will then take out their anger on you with harassing phone calls, negative reports to credit agencies, etc.
Since debt consolidation is not for everyone you need to see how they handle your case. Most nonprofit debt consolidation companies will offer credit counseling and debt consolidation right off the bat to get a full picture of your income, spending habits, and your overall financial situation. Any company that directly places you on a debt management plan is suspect.
Another important issue is the monthly payment. Be wary of any company that doesn’t send all the money you pay monthly to your creditors or charge you an “up front” fees or donations. The Federal Trade Commission records these unfair business practices as a common modus operandi of bad firms.
Ethical Non Profit Debt Consolidation Agencies
You can find a good nonprofit debt consolidation company to work with within your area. If you decide to work with an online company make sure that they have an office in your locality so that you are able to talk face-to-face with a debt consolidation expert.
A good company usually has been around for some time. They have many certified counselors and offer many kinds of services a debt consolidation agency has to offer. Check also whether they offer budget management and other financial courses. These courses could offer you the opportunity to make some changes within your financial life if you work on it the right way.
A reputable company that you want to work with should belong to the Better Business Bureau. They should have very few to no list of complaints from their clients.
Overall, getting in with the wrong non profit debt consolidation company can cost you your credit rating and your peace of mind. If you learn about this issue, however, you will eventually find a good company that can have a major impact on the success of your debt management plan and put yourself in a better financial situation.