Settlement companies have the professional expertise, experience and knowledge to settle debts for the customer effectively.
It operates as a part of the debt relief program offered by companies.
The counsellor makes a note of the customers total debt and negotiates with the creditors and gets a relief of 60-70% on the over all debt bill of the customer.
Small monthly payments are negotiated so that the customer can pay back easily.
While these services are beneficial for a customer it is important that the company should be chosen with great care.
Some of the important characteristics of a legitimate debt company are: 1.
The company has a reasonable fee structure.
The debt advice given to customers is completely free.
Before signing up the company would be upfront about the fact about what the fee is and is payable at what intervals.
A good company would not have a front load fee.
2.
The company would maintain an open policy for refund of money to the customers just in case they do not want to continue with the settlement.
3.
All customer information is kept confidential with the company.
Figures and the kind of financial problem the customer is going through will not be discussed with anyone else.
4.
The customer is put on a counseling session so that the customer starts understanding budget and living within the pocket and can avoid such problems in future.
5.
The company should be a member of the United States Organisation for Bankruptcy Alternatives.
This would prove the fact that the company is aware of all the rules and regulations regarding settlement and bankruptcy.
6.
The company should provide the customer an online facility to keep track of the account and get updates any time anywhere.
Signing up a good company will help the customer to get good results.
It will help in reducing more and more debt and get debt free as fast as possible.