PostHeaderIcon What is a debt consolidation company that isn’t a scam?


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I have debt, and it stands to reason that if you have bad credit, you can’t get a personal loan, so my only option is a debt consolidation company. If anyone has experience with this and used a company that turned out not to be a scam please let me know! Or if you know a company that screwed you over that would come in handy, too. Thank you!!

4 Responses to “What is a debt consolidation company that isn’t a scam?”

  • wg0z says:

    even if not scams, they’re all a waste of time.
    you dont get out of debt by dealing with these firms.

  • Judy says:

    You will need collateral to get a consolidation loan.

    Have you tried dealing with the creditors on your own?
    There are many, many good books at your library or bookstores.
    One I like is “Credit Repair for Dummies” – not for dummies at all – very good.
    It will teach you how to negotiate, settle, reduce payments, even do the pay on delete the right way.
    It will make you a PRO af fixing your own credit.

    There is a non-profit organization that does this for you – in case you are not a reader.
    National Foundation for Credit Councelling.
    NFCC.org
    They will help you at no cost.
    Go to the site and call the 800 number and make an appointment at a local office.

    If they put you on the DMP program (debt management program), the max cost is about $30 a month.
    But only if you can afford it – remember – they are non-profit.
    They will contact all your creditors and work with them.
    If bankruptcy is your only answer – they will be honest with you and tell you.

    Good reviews call them angels from above.
    Bad reviews say its embarrassing since you have to take all your bills and show them to someone.
    One person said they even cut up all his credit cards right there.
    If you don’t like embarrassment – do this yourself with the book – this agency does not do anything that is not clearly stated in the books.
    /

  • CatDad says:

    Debt consolidation firms have you deliberately default on your credit cards to settle for less. When you use such a firm, the monthly payment you make is going towards their settlement fees and to build a settlement account. Their fees are taken out first. Your credit cards will not be paid and will go into complete default during this process, which ruins your credit rating. This is deliberate so that they can attempt settlements for 50%.

    People signing up with debt settlement firms often have the mistaken impression that their creditors will gladly work with such companies..or that they are obligated to accept settlements. You can never predict how your creditors will respond..they might settle at 50%…or they might serve you a summons, take you to court…and if they win, you could be looking at wage garnishment. If the process fails you can end up in a much worse financial situation.

    If you’re struggling with credit card debt and you’ve exhausted all self help options, then there are really only 2 options: Entering a debt management plan through a non profit credit counseling firm like CCCS. They can negotiate reduced payments and interest but NOT settlements. Referral at: http://www.nfcc.org – If this does not work out, the other option is Chapter 7 bankruptcy.

  • JustDoIt says:

    Have you tried getting a secured loan? You may be able to get one when you put up a collateral – although you should keep in mind that your collateral would be at risk if you don’t make payments.

    One way to reduce the risk that any consolidation or counseling company is not a scam is to look it up in Better Business Bureau, and also ensure that it is accredited by NFCC (http://www.nfcc.org) or AICCA (http://www.aiccca.org) or equivalent 3rd party organization. Additionally, you can ask them various questions to see if their fees are reasonable, how they accept their fees, what other services are offered by them, and when do they send payments to your creditors – to determine if the company is genuine or not.

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