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Don’t get scammed by phony ‘debt relief’ companies

by | Mar 1, 2013 | Debt Management, Firm News

With as many people as there are across Tennessee and the entire country struggling to pay their bills, it’s no surprise that there are bad actors out there trying to take advantage of a bad situation. The story of what happened to one Tennessee woman should serve as a warning sign to others about what and who to avoid when you’re trying to pay off your debts.

The woman was called out of the blue by an out-of-state “debt relief” company promising her that they could get her payments lowered, and all she had to do was send them money each month. This can be an enticing offer for someone who is being crushed by mounting debt, but there are several warning signs to look out for.

First, the contract stipulated that the woman would have to send the company $306 a month. The federal government warns consumers not to send money to any “debt relief” company that charges upfront fees before results are realized. Second, the company advised the woman to stop paying her bills while she was under contract to them. This is terrible advice, because the woman’s creditors don’t care what she is doing with her money.

The 67-year-old woman is now worse off than before. She is approximately $16,000 in debt, with Social Security as her only income. Thankfully that money is protected, but she has repeatedly been summoned to court by her creditors.

There are credible agencies out there that can help you negotiate with your creditors to settle your debts or reduce your monthly payments. Companies that ask you to give them hundreds of dollars a month before any results are realized are not credible.

Source: WATE, “Debt relief company leaves Etowah grandmother even further in debt,” Don Dare, Feb. 13, 2013