Credit card debt is a struggle many are familiar with. With high interest rates minimum payments don’t seem to make a dent in the balance. Some turn to companies that promise to eliminate or reduce credit card debt for a fee. But far too often those offers aren’t legitimate. Here are a few tips to avoid credit card debt scams and information on where to get actual debt relief assistance.
Debt relief companies often make big promises to get consumers out of debt in no time for a fee. Unfortunately many are really scams that take thousands and sometimes hundreds of thousands of dollars from vulnerable consumers and do nothing in return. Some even advise their clients to stop making payments on their debts, leaving the consumer in a far worse predicament and damaging their credit. Countless consumers who have been duped by debt relief scams end up owing much more money in fees, penalties, and interest on their original debt.
One telltale sign of a scam is if the company wants you to pay upfront fees for them to help you get out of debt. This is illegal. Never pay upfront fees for any debt relief service. Our experience with many debt relief companies has been that a great number use misleading tactics, deceptive advertising, and outright false information to lure in clients and take their money. These companies often are in violation of state and federal laws that pertain to debt relief operations.
In addition to being mindful of upfront fees, watch out for anyone that wants you to pay for services using:
- wire transfers like Western Union or MoneyGram;
- gift cards;
- or payment apps like CashAop or Venmo.
These are not traditional payment methods used by reputable companies. They are the preferred payment methods for scammers.
You do not have to pay anyone to help you with credit card debt. A debt relief company cannot do any more than you can on your own to resolve your debt. If you are having trouble paying your credit card bills contact your credit card company right away. Speak to their customer service department and ask for an affordable payment plan. Another option is to seek assistance from a reputable credit counselor that can help you create a payment plan that works with your budget.
If you are looking to hire a debt relief company, get reviews and reports from trusted sources. BCA monitors reviews and provides transparent reports that consumers can use to make an informed buying decision. Anytime you are looking to do business with a company check BCA.
Here are a few more tips to help pay off your credit card balance sooner:
- Pay more than the minimum payment.
- Understand how much interest you are paying and make more than the minimum payment required to reduce the amount of interest over time.
- Avoid late payments.
- Explore your budget and find areas where you can reduce spending
If you’ve been scammed by a debt relief company, file a complaint right away. You can report the fraudsters to the Federal Trade Commission at ReportFraud.ftc.gov. If you paid the scammers using a credit or debit card or wire transfer, contact your bank right away and file a dispute.
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About Business Consumer Alliance
Business Consumer Alliance (BCA) is a non-profit company that started in 1928. The broad purpose of BCA is to promote business self-regulation. BCA's mission is achieved by assisting consumers in resolving complaints with businesses and using that complaint information, along with other relevant information such as customer reviews, to forecast business reliability. With community support, BCA can identify trustworthy and ethical businesses and warn the public to avoid unscrupulous businesses whose purpose is to defraud the marketplace. BCA also helps businesses promote themselves by providing services and tools to protect their business and reach out to their customers. BCA obtains its funding from member businesses who support the mission and purpose of the organization and who agree to abide by high standards of ethical business practices.