Get real help, not false promises, for your debt problems

Having trouble paying your credit cards?

Are you in danger of losing your home in a foreclosure? Many people find it difficult to pay their debts. The advertisements of companies that offer help can be tempting, but be careful; It could be a trap and it will end in a worse situation. Learn to avoid fraud and get real help with your problems debts.

Where can I ask for help with my debts? If you have trouble paying your mortgage, contact the mortgage company (where you pay the fees) and request a “loan modification”.  

For other debts such as credit cards, call the company as soon as you know you cannot make the payment. If you cannot reach an arrangement, call a nonprofit credit counseling service. You may have to pay a small amount, but most nonprofit credit counseling services give you advice even if you cannot pay.

They will explain your options, including filing for bankruptcy, and you may be able to implement a plan with your creditors to help you finish paying off your debts for a period of time. of fixed time.

What types of companies offer help with debts?

For-profit mortgage assistance services offer to reduce the amount of your monthly mortgage payments or take other measures to avoid a home foreclosure. Debt assistance services for profit are similar; They offer you to obtain an agreement from the companies that issue your credit cards and other creditors to reduce the amount of monthly installments or interest rates or pay off your debts by an amount less than the amount owed.

Can these companies charge in advance?

It is illegal for mortgage assistance and debt services to charge you before you have received a written offer from your creditors or mortgage company to change or settle the debt and you have accepted it.

But there are exceptions:

Federal regulations on debt relief services apply only to telephone sales. They do not apply if the sales presentation is in person or if the sale is made online. However, it is very risky to pay a company for debt assistance before obtaining results. Mortgage assistance services are not allowed to charge in advance whether or not they use telephone sales.

The company claims to be successful, does that guarantee me that they can help me?  

Do not! Mortgage assistance and debt services should be honest about their success rate and base it on the experience of all their clients, not only on those who obtained relief from their debts. But everyone's situation is different, and no one can guarantee that he will receive the relief he expects. That is why these companies cannot charge in advance.

Can there be a situation where you are allowed to ask me for money before getting results?

Debt assistance services may ask you to set aside money in a bank account to cover the expenses and payments of your creditors if they are successful in helping you. But the account must be in a secured financial institution and only under your control. You can stop working with the company and withdraw the money whenever you want, without any obligation to pay anything except for debt relief that the company has actually gotten you and that you have accepted.

What other danger signs should I keep in mind?

Be careful of companies that advise you to stop communicating with your lender or creditors. This is bad advice, and it is illegal for mortgage assistance services to advise you that way. If a mortgage or debt assistance service tells you to stop making payments to your lender or creditors, you must explain what the result may be: your credit may be damaged and your home could be lost; If you stop paying your credit card and other creditors, not only damages your credit but also increases the debt due to surcharges and interest, you may be given your account to a collection agency, and you can file a lawsuit . If the company tells you that it can prevent this from happening, it is another danger sign.

What else do I need to know to protect myself?

It is almost never worth paying assistance services Mortgage and debt. You can usually get the same results without paying anything, by calling the mortgage company, the lender or your credit card issuer directly, or by contacting a nonprofit consultant. Mortgage assistance services should inform you that they are not connected with the government or approved by your lender, that your lender may refuse to change the loan, and that you may stop using the service when I want it. Mortgage assistance and debt assistance services must inform you of the cost of the service before you sign up. Debt assistance services should also give you an estimate of how long it will take to get results and how much. You will have to save money before they can make offers to your creditors. The state or local consumer protection agency can tell you if any state law applies to these companies and can also advise you on what to do if you believe the debt is not yours.