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Imagine hearing about a company that promises to provide debt relief and reduce or even erase your debt for pennies on the dollar!  Sounds like the answer to your overwhelming, financial problems, right?

The Federal Trade Commission (FTC), the nations’ consumer protection agency, says slow down and consider how you can get out of the red without spending a whole lot of green.

DO YOUR HOMEWORKNot all companies are trustworthy.

FREEDOM DEBT RELIEF, the nation’s LARGEST debt-settlement services provider, and its co-CEO Andrew Housser, were recently slapped with a lawsuit by The Consumer Financial Protection Bureau (CFPB)!   According to the CFPB’s complaint, Freedom:

  • Charges consumers without settling their debts as promised
  • Makes customers negotiate their own settlements
  • Misleads them about its fees and the reach of its services
  • Fails to inform them of their rights to funds they deposited

You can check out the full article here:  https://www.consumerfinance.gov/about-us/newsroom/cfpb-sues-freedom-debt-relief-misleading-consumers-about-its-debt-settlement-services/

DO YOUR HOMEWORK – Debt Settlement Has Risks.

When making a big decision that involves spending a lot of your money, be sure to check out the company with your state Attorney General and local consumer protection agency.

  1. These programs often require that you deposit money in a special savings account for 36 months or more before all your debts will be settled.
  2. Your creditors have no obligation to agree to negotiate a settlement of the amount you owed so there is a chance that your debt settlement company will not be able to settle some of your debts – even if you set aside the monthly amount the program requires.
  3. Because debt settlement programs often ask – or encourage – you to stop sending payments directly to your creditors, they may have a negative impact on your credit score.

 

DO YOUR HOMEWORK – Check Out Other Debt Relief Options:

  • Negotiate directly with your credit card company
  • Work with a credit counselor
  • Consider bankruptcy

Declaring bankruptcy does have some consequences, including lowering your credit score, but credit counselors and other experts say that in some cases, it may make the most sense and can give you a fresh, financial start.

If you need some direction and want to know all of your options, give us a call.  The first consultation is always free.  We will answer any questions you have and help guide you to make the best decision for your situation.

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