Avoiding Debt Settlement & Debt Relief Scams
When it comes to handling debt, most people will look for any quick solution to get out of it.
So when someone gets in touch to say they can give you debt relief for a few months, you’d jump at the chance, wouldn’t you?
Except here’s the problem.
Debt settlement companies make all kinds of claims to help you with your debts, but the reality is that you could be left in worse trouble than before, owing even more money to your creditors.
Knowing how to avoid debt settlement and debt relief company scams can make sure you handle debt in an effective way.
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How to avoid debt settlement and debt relief company scams
If you’re thinking of using a debt settlement company to handle your debts, some of the things you need to be aware of include:
- Debt settlement schemes might ask for money upfront, which happens before any money is paid to your creditors.
- They will make big claims about what they can do, but the truth is that they will have little dealings with creditors, and won’t take your personal circumstances into account.
- They might advise you to stop communicating with your creditors.
All of these things could be red flags, and you should always seek professional advice before entering into any schemes like this.
Always read the small print
It’s important to look at the terms and conditions of your agreement in detail.
You need to look at where your money is going, and establish whether you’re just paying the company’s fees rather than settling your debts.
As with most things, if it sounds too good to be true, then it probably is.
If you end up missing payments to your creditors, you could incur fees and affect your credit score, something that will stay on your file for years.
While these sorts of schemes can seem beneficial in the short-term, there is a potential for long-term damage.
Finding the right solution to deal with debt
Dealing with debt can be difficult, but there are solutions out there to make it easier for you.
It’s important to vet any debt settlement companies carefully to make sure that you know what you’re entering into.
Working with bankruptcy professionals can also help you explore your options to get debt-free and avoid making problems worse.
To help clear your debt, it’s important to work with your creditors rather than stop payments altogether.
With the right action, you can manage your debts in an effective way and help rebuild your credit score.
If you’re looking for debt advice, we’re here to help.
Our teams can advise you on your options to make sure you and your finances get a fresh start.
Call us today and we’ll help you get on the road to being debt-free.
Information on Consumer Proposals
Consumer Proposals in Canada – An Alternative to Bankruptcy
What is a Consumer Proposal?
How to Amend a Consumer Proposal
What are the Benefits of a Consumer Proposal?
What are the Steps in a Proposal?
Consumer Proposal Eligibility
What Debts Are Erased in a Consumer Proposal?
Is There Life After a Proposal?
How to File for Bankruptcy
What is Bankruptcy?
How Does Bankruptcy Work?
What is the Cost of Bankruptcy in Canada?
How to Rebuild Credit Following Bankruptcy
Personal Bankruptcy in Canada
What Debts are Erased in Bankruptcy?