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Is debt consolidation a scam?

I am looking into a company I saw on TV, I was wondering if It’s a scam. The name of the company is united one debt settlement.

This entry was posted on Tuesday, July 27th, 2010 at 1:38 am and is filed under Debt Law. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

5 Responses to “Is debt consolidation a scam?”


  1. I would not call debt consolidation an outright scam…but it is a risky tactic that can create more problems than it solves.

    Stay away from any “debt consolidation” company that promises to cut your debt and payments in half through debt settlement….This is a risky tactic of deliberately ceasing all payments to creditors and forcing your accounts into default to attempt settlements. You pay a monthly fee to a debt consolidator….this entire fee goes towards building a settlement account and to the consolidator’s fees to “settle” your accounts in the future. Your credit card companies will deliberately not be paid so that all the accounts will default/charge-off so that they can attempt settlements at around 50%. If you are current on your accounts, this process will ruin your credit rating for sure. Debt settlement is like a roll off the dice with your finances…You can never predict how your creditors will respond to the deliberate defaulting of your accounts…they might settle at 50%…or they might serve you a summons, take you to court…and if they win, you could be looking at wage garnishment.

    Many people who sign up with “debt consolidation” firms incorrectly assume that they have the power to force your creditors to accept settlements…they don’t. Your creditors have the right to refuse settlements and take you to court.


  2. Anything on a tv commercial is borderline scam.
    Don’t ever do business with anyone trying to sell you something – go out and get it yourself.

    Google the name of the company followed by the word:
    scam, rip-off, complaint
    you will find good information about what these companies really do and how they take advantage of people.

    If you need financial help you can contact NFCC.org.
    It’s set up by the federal government as a non profit agency to help you.

    Or go to your library and find a book on credit/debt repair.
    They tell you step by step what to do.

    Don’t pay anyone for anything you can do yourself for free.
    NFCC.org is free – at most 25 / month to help you.
    /


  3. Some of these companies actually are connected with credit card companies and are trying indirectly to get money from you. I suggest you visit a webpage called debtendnow.com and read the free ebook called “How To Control Your Creditors”
    Feel free to email me if you want to get some straight and direct answers.
    Click on my image icon to find the email link.
    Hope this helps.
    Rob


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  5. Debt Consolidator services are wide spread and a person looking to consolidate his or her debt needs to know exactly what to look for.

    For example when you consider your creditscore (have you gotten any yet?
    ” debt consolidation companies will match this info against your debt amount, income and a lot of other factors.

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