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Avoid credit card debt relief scams

Benefits of Debt Relief Programs

People who are heavily in debt can benefit significantly from debt relief programs. These plans are designed for this specific purpose, but the specific terms of the plan chosen may have a different impact on each person’s financial situation. If you want to get yourself out of any debt, then you must choose a debt relief plan that meets your needs.

For example, debt negotiation is a common type of debt relief plan that provides benefits to debtors. It saves money because you can pay less than what you originally owed, and it saves you time because a professional debt negotiator will discuss this debt reduction process on your behalf. If you are able to choose a reliable and sound debt relief program, most people with debt will find themselves debt free within two or three years.

Common Scams

While there are several legitimate debt relief companies in the industry, there are those who want to take advantage of people’s desperation to settle their debts. Like legitimate debt relief companies, they promise debtors the chance to become debt free. Sadly, however, they often target people who are desperate for debt relief because they can’t afford to lose money.

There are some common signs that the debt relief program you are dealing with is a scam. Therefore, recognizing these signs will help you realize who to trust and who not to trust when looking for solutions to your debt problems.

Charging a fee to fix your credit report

There are debt relief programs that offer the service of cleaning up your credit report and any errors for a substantial fee. The process is quite complicated, which is why most people often choose to hire professionals to do this for them. However, you need to be extra careful when choosing one because some of them can be downright deceptive. Another reason why this claim is considered a scam is that you can get your credit report repaired for free. There are three credit bureaus from which you can get a free copy of your annual credit report. When you get the copy, study it for any false information or suspicious transactions.

Loans to fix bad credit

This particular scam affects debtors in two ways. First, you are charged for a loan that you didn’t even qualify for to begin with. Therefore, the money you spent to settle the loan is wasted because you could have used the money to settle your previous credit card debt. Next, you never receive any money despite your creditors’ claims that you have lent it. To make matters worse, these scams don’t provide you with a legitimate company name, so they essentially run off with your money and you have no way to track them down.

False Identity

This is a sure sign that you are dealing with a fake credit repair company. When they ask you to create a new credit identity to get a high credit score, then you need to realize that this is a completely illegal practice. Even if you are not familiar with the law, then everyone probably knows that creating a false identity is a clear violation of the law.

Therefore, before you decide to work with the credit repair company that you deal with, make sure that you screen them. If you really want to get rid of any credit card debt you currently have, then choosing illegal means is not the best way to go. In addition, being affected by a scam can cost you money that could have been used to pay off your credit card debt.