Thursday, December 20, 2012, AM | 4 Comments
In this upsetting economy of present times, majority of the people are looking for assistance for managing escalating debts. Different types of Loans permit you to consolidate different types of debts; there are soundly consistent and trustworthy financial institutions which provide such individual finance aid for several years.
Numerous other businesses also recommend debt consolidation loans. In the midst of them are financial institutions that insistently and assertively market what basically simmer down to a rip-off and ultimately land up cheating individuals.
Their plans differentiate them from lawful debt management mechanisms. Some of the things that need to be kept in mind to avoid Debt Consolidation scams are:
Check if the company is trustworthy
Make sure that the company you are choosing for debt consolidation is genuine and lawful. Call the office of your state’s attorney general and the central Trade Commission.
Also check with the Business Bureau to find out whether any objection or a complaint has been put against the organization. In this way you can find out the authenticity of the company.
Your financial information should be kept a secret
It is very significant that all your monetary information is kept private. To offer a quote, a debt consolidation company only necessitates the name of the creditor, balances and also the interest rates.
They do not require any personal records like the account numbers and the social security number.
Make comparative study of the rates
Before finalizing any company for debt consolidation, it is better to compare the fees and not the monthly payments. You ought to get the similar rates from each debt consolidation program as they all acquire the identical deals from their creditors.
If a company is providing you a lesser monthly payment, it could be because it is expanding the time period of the loan. With this you may land up paying more later on.
Be cautious of the additional fees. You are not supposed to pay for a quote or an investigation. A lot of debt consolidation companies charge high levels of unquestionable fees that will come up few months after you start with them.
A few of the fees are divided into the monthly expense. In this case they take money from you and then send it to the creditors. Majority of the companies charge 10 percent which is much more than what they are paying to their creditors and thus make huge profits. After that they even get a 10% to 15% refund back from their creditors.
Do not make a hasty decision
Take your time before reaching a decision. Employees are trained to con the customers and they freely play with your emotions and sentiments.
The time when you are talking to a counselor, you must surely take a friend of yours who will surely restrict you from taking a hasty or an instant decision to sign up.
A friend will definitely advise you to leave that place after you have spoken to the counselor and taken all the details.
Andrew Hopes is the author of this post. Apart from the time he spends in the library reading and writing about various financial topics, he offers debt relief advice for those looking to put their debts to bed.
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