subject: Choosing the Right Debt Management Company [print this page] When you consider using a debt management company to help you resolve your debt issues, you need to perform some research before choosing which firm to hire. Some companies make bogus claims that require you to send them money before they can begin relieving your debts. But once you send the money, nothing happens and you're still in debt. There are also companies who may offer bad advice that not only put your further in debt but continue to damage your credit score. You need to make sure that the company you work with is reputable and has a history of successfully helping people manage their debt. Remember that a debt management company usually can't relieve you of your debt, but will work to reduce your payments or extend the amount of time you have to pay so that you can pay off the debt without dire consequences.
Check the Company's Reputation
If the debt company has been in business for a bit, there should be some form of record available for you to review. There may be a business or trade association that handles complaints against these types of businesses, and they will provide you with general information about any business you're looking to work with. While a certain number of complaints are normal, you want to be careful if a company has a large number of unresolved complaints. This means the company either couldn't or wouldn't help the customer to resolve the issue.
If the company has a website, check and see if there are any reliable testimonials. Some websites will include a couple of testimonials that have contact information of the client. This way, potential clients can speak with a former customer and insure that the testimonial on the website is accurate.
Get a Contract or Written Agreement
As with any business transaction, make sure the company you work with has a contract or written agreement that details exactly how and what you will be paying. Do not send any debt company a cheque or any other form of money if there isn't a contract in place. Some firms may be vague on how they will be using your money and who they will be paying, so by having a contract you know exactly who is getting what money and when they should receive it. While most consumers will have no problems with their debt management company, it always helps to be cautious and make sure you're dealing with someone reputable.
