Free credit card consolidation: Stay away from scam companies
Friday February 5, 2010
Nowadays, there are many advertisements that tell you about free credit card consolidation or credit card debt consolidation for free. In spite of the fact that genuine debt consolidation companies do exist, some of them are simply scams that prey on unsuspicious consumers.
You should understand that there are various measures that you can undertake on your own to solve your credit card debt problems. However, if you're determined to go for professional assistance, it is very much essential that you take the necessary steps to verify the legitimacy of the company. You should evaluate the net worth of the company, examine their payment plans and perform maximum due diligence prior to signing on any type of agreement with the company. Given below are some steps that you can take to stay away from scam credit card consolidation companies:
Be suspicious of companies declaring to be nonprofit
Majority of scam companies would represent themselves as nonprofit companies, which is probably a fake claim. Debt consolidation companies are businesses that work to make a profit for their proprietors and stockholders. They can't survive if they don't make profits. You shouldn't depend on a company only since they declare themselves to be nonprofit.
Look for recommendations from customers
Though on certain occasions it might be difficult, the Internet can help you access various forums where actual customers share their experiences with different consolidation companies. A lot of consumers inform about scams so that no other consumers fall into the same trap. You can check out the companies that you have short listed with these forums as a protection from being conned.
Gather multiple quotes for rates and monthly payments
You should ensure that you receive authenticated quotes from all companies you have taken into account. Most credit card consolidators work in an identical manner and should come to approximately similar interest rates and monthly payments that you need to make to your creditors. The most effective technique to steer clear of being scammed is to talk about your specific condition with various consolidation companies and collect personalized quotes from them before moving ahead further.
Stay away from companies that advise you not to contact credit bureaus
Many scam companies providing credit card consolidation services tell you not to talk to the credit bureaus. You should understand that you have the right to talk to the credit bureaus and these advices are red flags of scam companies.
Don't make payments for services before they are offered
You should stay away from companies that ask you to pay for their services in advance in the form of upfront fees. As soon as you make the payment, they would vanish like fly-by-night companies. According to law, companies should offer the services first before receiving any payment from you.
Following these steps would certainly protect you from falling prey to a scam credit card consolidator.
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