Credit Card Debt Management Services – The Downsides

Are you looking for credit card debt management services companies? Are your credit card debts big hassles for you?

Are you one of those who are falling behind in their credit card payments and getting fed up with frequent calls from insistent credit card debt collectors demanding payments?

Or, if you are not comfortable of going through credit card debt management yourself; then a debt management service company is what you need.

However, before signing up with one of those debt management services on the market, you should find out if you truly need their assistance.

Reports show that even if pricing structures varies among the different companies, the fees are generally high and when credit card consumers are already knee deep in credit card debts, up-front fees as high as fifteen percent of any agreed amount is predominantly outlandish.

But, consumers are still contacting these companies because they are looking for help and are scared of being sued.

Sprouting Credit Card Debt Management Services Companies

Credit Card Debt Management Services - The Downsides

Credit Card Debt Management ServicesCan credit card debt management services help you get rid of those unwanted calls from collectors and save thousands of dollars? Yes, they can, but there is a catch.

Debt management services are big business. Even if the fees these debt management companies charge are ridiculously high, they are not the main problems.

There is no legislation governing numerous companies which have sprouted in recent years offering services to assist consumers lessen the credit card debts they have created through irresponsible purchases.

The lack of legislation has led to somewhat bizarre situation where a person can set a debt management services company in a day and begin handling consumers’ money.

All a person need for this business is a flashy name that people can easily remember and a well-created website with an address that is also easy to recall.

No Problem at all?

Most reviews on these companies showed positive results. There are some credit card debt management services companies that have been paying the bills of thousands of credit card consumers for over ten years.

So far, these debt management companies have kept their promise to reduce people’s credit card debt by fifty percent and save thousands of money.

They reported that people who put their trust in them have nothing to loose and that these people have allowed them to manage their money.

However, it was recently reported that people did have something to lose. There are some debt management companies that disappeared overnight and people who put their trust on them have lost their money.

No Guarantees!

There is no guarantee that the credit card debt management services being offered are legitimate.

Also, there is no guarantee that a credit card company will accept partial payment of a credit card debt.

But, it is certain that credit card companies have legal obligation to give an accurate data to the credit reporting agencies about your credit and your failure to make monthly payments. The creditors may also have the right to sue you in order to recover the money you owe them.

If the credit card company wins the lawsuit, it has the right to put a lien on your home and collect from your wages. The Internal Revenue Service may also consider any amount condoned from your credit card debts as taxable income.

Therefore, before you commit to any credit card debt management services company; the Federal Trade Commission advice that you first ask these questions:

  • What are the fees for the debt management service and when do I pay them?
  • Do I pay the fee upfront?
  • What are the services actually included for the fee?
  • Will you resolve and work on all of my credit card debts?
  • Even if you cannot help me get the way out I want or the solution that works for me, will I pay a fee?
  • What skills of education do your credit card debt advisors have?