5 Tips for Finding the Right Consolidation Agency
Money Goals
- Posted:
3/26/2009
You know those infomercials you see early in the mornings on tv? I always thought they were nothing more than possible scams and just not trustworthy. But one morning I woke up to an infomercial about debt repayment. So I checked their website online and I checked with the Better Business Bureau (BBB). And then I signed up with a consolidation agency. Due to this twist of fate I was able to pay back three credit cards within three years, just like they advertised. I continue to use their services for other debts that have occurred over the years and I trust them 100%. But I did not know how lucky I was in choosing them, because there are some agencies who disguise themselves as a consolidation agency, but are actually scams. So here are some tips for those of you who are looking for the right agency to help you repay your debt:
1. Do your research. When you come across a name of an agency check with the BBB (
http://www.bbb.org/). This is where you can find out their performance rate with customers, whether there are complaints resolved or unresolved, and they have a grading system. If the compnay is registered with the BBB you will find out how long they have been in business, etc. You also can lodge complaints as a consumer on this site for companies you have had a serious problem with to help inform others. Remember we are all in this debt crisis together.
2. Face your fears. Don't just think you know you're in debt. Know just how much you are in debt. This is hard. The best method is to collect all your unpaid bills and place them in a folder. Tally up the amounts. You need to have all the information, such as contact info for creditors, balance amounts and due dates, available when setting up a consolidation. These consolidation places are doing the best to help you so you need to do the best to help them get you on track.
3. Ask questions. Recently I read an article in a magazine about some agencies that require a "gift" payment up front. This is not a legitimate agency to use for debt repayment. The people in the article not only were scammed by the company, but they also got into further debt because they thought things were being handled correctly. It is true that the agencies will charge you a few, based upon the amount you are consolidating, but it will be part of the monthly payment you pay them. They then will divvy out the monies to the creditors. Find out approximately how long the repayment will take (on average it's 3-5 years based upon the debt amount).
4. Set up automatic payments. If you are the type who will say "I'll catch this up later" then auto payments to the consolidation place is the best way to go. It's preset and you cannot negotiate yourself into doing something else with that money. After all, poor negotiation tactics helped us get into this mess, whether it was ourselves or the companies themselves. So take the initiative to pay it off.
5. Breathe. The balances don't seem to go down right away. But eventually they will. And then the snowball effect occurs. You know that dreadful feeling of the snowball effect when your debt began to build up, well it's a relief feeling when you see it snowballing down your debt. And you feel quite proud of yourself when your consolidation agency sends you that final letter saying "Congratulations".
These are a few tips to keep in mind when searching for a consolidation agency. Not many people have faith in them, and many people even think it may hurt your credit scores. I can tell you from experience that I have faith and it's helped my credit score. I once applied for a car loan at a few banks. My credit at that time was not up to par, but one loan officer actually told me that she recognized my effort and hard work in repaying my debt. Now maybe I received bad news that day, but for once I had a person who complemented my effort for accountability.
http://www.cambridge-credit.org/
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