Watch out for debt negotiation scams
You should know that just because a debt negotiation company calls itself a nonprofit, that's no guarantee that it's a legitimate organization.
If you're in debt and you're seeking the help of a debt negotiation company, the Federal Trade Commission says that you should watch out for the following scams.
Watch out for debt negotiation companies that:
- Guarantee they can remove your unsecured debt.
- Promise that unsecured debt can be paid off with pennies on the dollar.
- Claim that using their system will allow you to avoid bankruptcy.
- Require substantial monthly service fees.
- Demand payment of a percentage of savings.
- Tell you to stop making payments to or communicating with your creditors.
- Require you to make monthly payments to them, rather than with your creditor.
- Claim that creditors never sue consumers for nonpayment or unsecured debt.
- Promise that using their system will have no negative impact on your credit report.
- Claim that they can remove accurate negative information from your credit report.