Many people who have accumulated various debts are looking for a reliable debt consolidation non-profit company, hoping that they will receive affordable advice and assistance. However, a lot of companies abuse the term “non profit” for various reasons – one of them being the ability to make unsolicited telemarketing calls and be exempted from the regulations imposed for this type of marketing activity on commercial companies (debt-consolidation-services-review.toptenreviews.com).
There are various caveats that consumers must be able to spot before they decide to sign a debt consolidation agreement with a company, but it is more useful to bring to light the aspects that differentiate a legitimate debt consolidation non-profit organization from scams.
1. Non Profit Status
This is the first proof you must request from the company when their consultant first approaches you for a discussion. A legitimate organization has its non-profit status specified in the Internal Revenue Code as (501(c)(3)). This code is reserved for non-profit entities that are tax exempted.
If the consultant fails to produce the IRS code or cites confidentiality issues (there is nothing confidential about the tax code), then, most probably, the company is using the non-profit denomination falsely and without a legal base. This is your cue to walk away from the discussion without signing anything.
2. Expected Period for Erasing Debt
Debt is usually accumulated over years and in significant amounts. There is no magic formula to write off your debts within months. Any company making promises to give you a clean slate “by the end of the year”, “in time for Christmas”, or within other unrealistic time spans will not live up to their promise. You will pay the consultation fee for nothing, and the debt will continue to accumulate.
A reliable debt consolidation non-profit organization will present you with a plan that extends over a few years, with the numbers carefully broken down per type of expense, to give you a clear view of how your debts will be paid-off.
3. Effects on Your Credit Score
Using any kind of debt consolidation service will affect your credit score. There is no way to avoid it and, if consultants say that their company has some mechanisms to prevent it, they are lying. Honest debt consolidation providers will inform you what you should expect in the future in relation to your credit score.
These are just a few helpful guidelines but, as a general rule, use your common sense and ask yourself: is this offer too good to be true? This will help you select a reliable debt consolidation non-profit company and obtain the desired outcome legally.