A Comprehensive Guide To Choosing A Debt Consolidation Firm

June 12, 2015/0 Comments

A reputed and reliable debt consolidation firm should be having goodwill in the market and should be known for its success and integrity. They should be able to come up with clear-cut answers in response to all your questions. They would be working toward making your bills far more manageable.

How Do Debt Consolidation Companies Help?

Firms that are offering debt consolidation services would try and persuade your creditors to bring down your interest rates and minimize any late fees or penalties that you have accrued. A debt consolidation company often enrolls you in some sort of a Debt Management Plan that would take into account your monthly expenses as opposed to your income and determine an amount that you can pay comfortably every month. Debt Management Plans usually last for three to five years and generally, do not have a negative impact on your credit profile or credit score.

Debt consolidation companies usually assess your case thoroughly and offer debt consolidation loans or may ask you to get a HELOC (Home Equity Line of Credit) or Home Equity Loan. There are several companies that provide unsecured debt consolidation loan for you. However, you must keep in mind that the interest rate for a debt consolidation loan is bound to be pretty high.

A Comprehensive Guide To Choosing A Debt Consolidation Firm


Some Necessary Steps for Choosing a Debt Consolidation Firm

First of all you must make a list of the firms you seem to be interested in working with. You may browse the Internet for Debt Consolidation Firms, Debt Relief Companies and Debt Management Companies. Always remember to go through customer testimonials. Include only reputable firms with good credentials, in your final list.

The second step is to call up the firms in your list, one by one and shoot your queries. By talking to a company representative, you could understand and get complete information about exactly how the firm operates and you could get relevant details about the firm’s debt consolidation program.

The ultimate step is to do ample research about all the debt consolidation companies you have shortlisted. You should most definitely check the company’s ratings by consulting with the BBB (Better Business Bureau). You may consider calling up the State Attorney General Office in your locality to ensure that there are no pending suits against the chosen company of your choice.

Things to Look for in a Debt Consolidation Company

Always look for a company that comes up with debt solutions that make perfect sense to your circumstances and to you in particular. Choose a company that is ready to give you honest information regarding fees, the merits and demerits of its debt solutions, its experience and if it complies with the guidelines of the Federal Trade Commission (FTC). It is a known fact that any accredited debt consolidation firm would strictly adhere to FTC rules and regulations. Check out the firm’s trade organization memberships. It is best to look out for genuine references and feedback. Browse through debt consolidation reviews for more information and tips.

A Quick Check

There are certain things you can look for to check a company’s credibility. You must check if the company of your choice is accredited with BBB. Many debt consolidation firms are not accredited with Better Business Bureau and often, some of them are not even rated probably because of the lack of data or information. By checking with the BBB, you may now know if there are any consumer complaints or court cases pending against the firm.

Next important thing to do is to see if the company is registered with The National Foundation of Credit Counseling or The Association of Independent Consumer Credit Counseling Agencies. Finally, you may opt for any non-profit debt consolidation organization, but make sure that it is a reputable and reliable one. It is better to check their 501(c) (3) certificate as that is a proof of their authenticity and legitimacy.

Always remember that even non-profit organizations need to charge fees for their services. It is a good idea to compare the charges so that you get the best deal. The most important point to remember is that you should choose a company that makes you feel comfortable and is able to fulfill your requirements.

Michael Stark is an experienced investment analyst. He is currently attached to a reputed merchant bank. He is passionate about blogging and has a fantastic fan base. He loves to write about personal finance and enjoys debt consolidation reviews.


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