Frequently Asked Questions about Debt Therapy

How do I avoid debt therapy scams?

The best way to avoid debt therapy scams is by using the free referral service here at DebtTherapyExplained.com. If, however, you choose to search for a service the hard way on your own, here is some information to help you avoid being taken advantage of.

Debt therapy scams come in many forms but there are a few warning signs you can look for to help you spot them:

• Watch for 'non-profit' or religious groups: There are plenty of non-profit and religious debt counseling services out there, but scam artists like to take advantage of those two concepts to lure in unwary people who are looking for help. Be sure you research them thoroughly before signing up with them.
• Asking for payment up front: Before even making a serious evaluation of your income and debt situation if a service asks you for money, beware! Legitimate services will take the time to get to know your situation and whether or not they can actually help you before they request any payment.
• Making outlandish/seemingly impossible claims: If a service claims to be able to "completely eliminate your debt in just a few days!" or something similar, you should high-tail it away from them as fast as possible. Legally the only way to remove your debt is to negotiate it down, pay it off, or have it discharged in a bankruptcy. Any service that claims to have another way that "credit card companies don't want you to know about" is scamming you.

Is my information secure?

Absolutely. This site uses only the latest in secure socket layer, (SSL) technology to encrypt your information as it is transmitted to us and through our network, keeping it safe from prying eyes.

How much does debt therapy cost?

Different services charge different amounts for the various services that they offer. Based on your initial evaluation and recommendation, the counselor assigned to help you with your debt situation will clearly spell out any fees and payment schedule if you choose to go with their recommendation.

Does debt consolidation hurt my credit score?

Not usually, no. Debt consolidation is essentially a 'debt exchange' and that will sometimes have the effect of reflecting positively on your credit score. For example, if you have six credit cards with $15,000 total worth of debt and take out a home equity loan for $15,000, the bank that gave you the loan will report on your credit that you now owe them $15,000, but as you use that money and pay off those six credit cards, those cards will now report to your credit report that you have paid those debts in full - a very positive thing! When all is said and done you still owe just $15,000, only now you have fewer debtors and probably a lower interest rate and easier payments as well.

How do I know which debt therapy option is best for me?

It is best to rely on the advice given to you by your counselor in the company you choose. If you wish you can request to have your case evaluated by someone else within the company as a 'second opinion', usually free of charge. If their recommendation seems too simple to you and not likely to solve your financial problems (such as recommending budget counseling), you might want to consider giving their recommendation a chance before judging it as too simple.