How To Select A Debt Management Group

2007-03-08 10:33:40

( Financial )



When you have a large number of debts, and have been encountering problems in making repayments, a debt management group can help you manage the payments of all your outstanding debts in order to make you debt-free.

A debt management group will get in touch with all of your creditors, negotiate for the best repayment scheme and consolidate your loans into a single amount. You existing credit accounts will temporarily be blocked, so that you are not tempted to incur any further debts. When a debt management group takes over the management of the payment of your bills, you need to make your monthly payments to the debt management service directly instead of your various creditors.

There are a number of factors you should consider when selecting a consumer debt management service:

Debt management groups that send you junk mail, or call you offering the services of the company are usually fraudulent. Legitimate debt management services normally advertise on the local phone book or the Internet.

Be cautious when dealing with non-profit consumer debt management services. These companies tend to charge a higher service fee based on a certain percentage of the total debt amount.

In order to avoid fraud and identity theft, never give out your credit card details to debt management groups over the phone. Debt management groups will always ask for these details in a different manner.

You should only select debt management companies that have been in business for longer than a year. A company’s reliability can usually be determined if you contact the local business bureau in your area.

You can also judge a debt management company’s reputation by reading consumer reviews/testimonials that can be found on the Internet.

A good debt management group should be able to assure you of maintaining confidentiality on your accounts.

Finally, you should realize that some debt management groups could charge a monthly service fee.


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