How to Find a Reputable Debt Settlement Company

In today’s tough economy many consumers are finding it increasingly difficult to pay their minimum monthly credit card payments.  In response to this trend there has been a drastic increase in the number of Debt Settlement Companies opening up for business.  With so many new companies offering to help settle your debts how do you choose which company to use?  How do you know you are dealing with a reputable Debt Settlement Company and not a scam artist?

It is important to perform some level of due diligence when choosing a company to help settle your debts.  The first place you should look as a consumer is on the TASC website.  TASC stands for The Association of Settlement Companies, www.tascsite.org.  TASC is a non-profit organization who’s “goals are to promote good practice in the debt settlement industry, protect the interest of consumer debtors, and lobby on behalf of debt settlement companies on the federal and state level.”  When a Debt Settlement Company is member of TASC they agree to perform business with the standards set out in the TASC bylaws.  “The Bylaws have been developed in consultation with a number of debt settlement companies, discussions with different states’ legislators, and major lenders. The aim of the Bylaws, and that of TASC, is to encourage debt settlement companies to provide services of the highest standards to ensure the public and the credit industry’s confidence.”  There are currently roughly 2500 Debt Settlement Companies in the country, only 197 of these companies are members of TASC.  If you choose not to do business with a member of TASC you will be dealing with a company who is flying under the radar. 

Once you have verified that the company is a member of TASC, which you can do so by visiting their website, you should also know the answer to the following questions.  Does the Debt Settlement Company hold your money for the settlements?  Debt Settlement Companies should never hold your money for you.  Your money should be held in a personal checking or savings account or in a special purpose account set up in your name, not in the Debt Settlement Companies name.  This is important because you should always be in control of your money.  The account should also be FDIC insured.

How long is your program?  On average you should try to get out of debt in 24-36 months, no longer than 48 months.  If a Debt Settlement Company is offering to get you out of debt in less than 12 months be cautious.  Also if they are offering a 60 month term or longer be cautious. 

How will this program affect my credit?  Debt Settlement will have a negative effect on your credit score. If any company tells you any differently they are lying to you.

What are the legal consequences of settling your debts?  Creditors do have a legal right to sue you for failing to pay your debt.  This doesn’t happen very often but it is a possibility that you should be made aware of.  If a company tells you any differently you should not do business with them.

Besides being a member of TASC the debt specialist you are speaking to on the phone should be IAPDA certified. International Association of Professional Debt Arbitrators, www.iapda.org.  On this site you can type in the sales reps last name and you will be emailed within 24 hours letting you know if that person is an active member of IAPDA.  “The IAPDA training and certification program is dedicated to serving its members by defining and validating the profession of Certified Debt Specialists through practical industry knowledge, debt and credit education and by certification of professional successfully completing the program.”

I own and operate a very reputable Debt Settlement Company called Square One Debt Professionals, www.squareonedebtprofessionals.com.  I can’t tell you how many people I speak with on a daily basis who have recently been ripped off by a shady company that was more interested in charging the customer fees than helping them get out of debt.  I hope that by reading this article you will find it a little easier to find a reputable Debt Settlement Company that will in fact help you in your time of need.