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Hiring an online debt relief firm-a tricky job

Revolving debt has become a serious problem in the U.S. According to the Federal Reserve, revolving debt in America stands at $796.5 billion. Therefore, it’s not surprising that household debt is at a record high and people are having a tough time to pay the bills.  

Consumer debt has been traditionally high in the U.S. Unwise spending has been a major reason for this. The recent financial depression has also played its role to get things worse. It has caused wide spread unemployment and wage cuts. The economic meltdown has also let loose the dragon of inflation. As a result, an increasing number of people are falling into debt.

What is the best way to eliminate consumer debt? Well, if you have not incurred heavy debts, then you can manage things by yourself through budgeting and debt reduction tactics like debt snowball. But most people have huge credit card debt and it is not possible for them to solve their problems without professional help.   

Online debt settlement companies and law firms can eliminate your debts effectively. However, you should choose them carefully. If you fall prey to a scam or a useless company, then your financial situation will worsen further. Therefore, remember the following points before making a decision:

    * Is the debt relief firm making promises, which seem to be damn good? You should better watch out. Things which are too good to be true are mostly scams. For instance, it is possible to reduce 50%-80% of your outstanding balance through debt settlement. But your credit gets affected. If some company promises you to get your debt settled without damaging your credit rating, then it is not revealing the truth. You have reasons to believe that it is a shady company and you should stay away from it.

 

    * Are debt relief firms expensive to hire? Well, they are fairly affordable. But you should always reject a firm which is outright expensive. Remember that you are hiring them because you are already deep in debt. Paying exorbitant fees to debt relief companies definitely won’t help you. Also, some firms charge very high upfront fees. Stay away from because FTC has banned advance fees. These days, legitimate and reputable firms don’t charge upfront fees to the consumers.     

 

    * Search the internet for information on the debt relief firms you are considering. Check whether they have any pending lawsuits. Also try to find out their client feedback. Trustlink.org is a good place to know the opinion of the consumers about debt relief companies. Also, lay emphasis on the better Business Bureau (BBB) rating of the companies. Good rating with the BBB usually means good customer service.

 

    * Enquire whether the debt relief firm will provide you legal representation if required. Sometimes, the creditors refuse to agree to debt settlement. In such a situation, bankruptcy is the way to go for a consumer. But you would need to look for a bankruptcy attorney, if the debt settlement company does not provide you any legal service. This can be pretty inconvenient. Also, attorney services are very useful when you need to sign legal agreements with your creditors during settlement process.

 

Choosing the best online debt relief firm can be a challenging task. Therefore, you should do your homework and remember the above points to make the right choice.