Tips for Avoiding a Debt Relief Scam

The current debt relief scam epidemic is seeing people who are already in financial stress end up ruined beyond repair and forced into bankruptcy. The global economy is slowly recovering, but many individuals and families are still feeling the devastating effects of lost investments and corporate downsizing.

There are plenty of scammers out there who have no scruples when it comes to preying on the financially vulnerable. Learn to spot the warning signs of a debt scammer and make sure you don't end up getting sucked in to something that will make your money faster than ice cubes melting on a hot sidewalk.

Telltale Signs of a Debt Relief Scam

Most scams are fairly easy to spot if you know what to look for. At the end of the day, trust your gut instincts—if something doesn't seem right about a company, or what they are offering, just walk, no run away and don't deal with them at all.

Here are some of the common red flags. Should you encounter a company doing any of these things—steer clear.

• Claims made by the company sound too good to be true, or contradict what you have already read in official documents from a bank, lawyer or government documents or website.
• Any request for an upfront payment before the company has begun working for you, this is actually now illegal under most circumstances.
• The company offers services that sound legitimate, such as debt consolidation, but their prices for services are much lower than their competitors, this is usually the first sign of a bait and switch.
• Watch out for fake credentials. If a company claims to be a member of an official-sounding association, do some background checking to make sure it really exists and they are actually a member. This is a tactic scammers often use to make themselves sound more legitimate, because they know most people won't bother to check.

I say again—steer clear of any company doing any of these actions and you will avoid the any chance of getting entangled into a debt relief scam.

Types of Scams

The most dangerous scams, and the ones people fall for most often, are the ones that appear on the surface to be legitimate deals. The company may even have offices set up and look very professional. But you can typically tell whether or not a company is legitimate by the way the company operations are run.

For instance, does the staff seem more like a “sales team” than an agent? Then, watch out. If you are being hit with a lot of high pressure sales tactics aiming to get you to sign your life away on the spot, you need to just walk away.

Companies that are desperate to lock you into a contract before you have a chance to think things through are typically using some unscrupulous business practices or at the very least not delivering real results to their clients.

Some scammers make outright attempts to fleece you and then disappear with the money, but others will sign you up for an otherwise legitimate plan while knowing their plan really can't or won't help you.

Real Debt Relief Options

Of course, don't let scammers put you off real options that can help you out of debt, like debt settlement and debt consolidation. These debt relief methods are not scams in and of themselves and they can be very effective under the right circumstances when administered properly. Just make sure you hire a debt relief attorney or debt relief company with a proven track record of success and upstanding credentials.