If you are living with seemingly insurmountable debt, it may seem tempting turn to a debt consolidation company for help paying off your debt. However, our law firm strongly advises people to be very careful about choosing to work with a debt consolidation company. Many debt consolidation companies are unethical and dishonest. You could unknowingly become the victim of a debt relief scam.
The Law Offices of John E. Mufson in Delray Beach can help you determine if a debt consolidation plan is a good idea. More often than not, people should be choosing to work with a nonprofit agency or a bankruptcy attorney instead. You do not have to fall victim to a debt relief and negotiation scam. Contact our Boynton Beach, Florida, lawyer today for a free initial consultation.
Debt Consolidation Companies Should Be Used With Extreme Caution
As a general rule, bankruptcy attorney John E. Mufson advises people to avoid using debt consolidation companies. These companies are not upfront about their fees. They are really only out to make a profit, and they make that profit from well-intentioned yet uninformed debtors.
Debt consolidation is when a debtor combines his or her debts into one manageable payment that is less than the total amount owed. While this can sound great at first, there are several things that debt consolidation companies fail to tell you.
- You will be required to make a large upfront payment. Most people with debt do not have the resources to pay that upfront fee.
- The debt consolidation companies will charge you a fee. When you pay your monthly payments, they will actually deduct their fee from your payment before paying creditors. This means your creditors are not being paid off, and you could end up being in even more debt than when you started the process.
- Many debt consolidation companies stay in business for a short time — just enough time to take people’s money — and then they close.
If you are thinking about using a debt consolidation agency, be warned that it could be a scam. Talk to us before you talk to them. If you file bankruptcy, you can avoid getting sucked into a scam and obtain honest, ethical debt relief.