Do You Know The New Debt Settlement Company Tricks?

Recently, new federal regulations went into effect that were designed to stop debt settlement companies from stealing money from customers without ever providing the services that they promised. However, many debt settlement companies in Illinois and Missouri are already finding ways to skirt the new laws and to continue to mislead customers just as before.

Especially in the past few years, many debt settlement companies have thrived off of offering their customers false promises – such as erasing half of their debt in just months. At the same time, others have profited from charging large up-front fees – fees that often totaled up to 15 percent of that person’s total debt. In many cases, these companies would never lift a finger to help their customers pay down their debt, or else would do little more than make minimum payments. But now that many old hat debt settlement company tactics are illegal, the companies are now finding new loopholes.

In order to skirt telemarketing violations, many debt settlement companies are now contacting their victims through text message, television ads, internet chat rooms, Skype, and other non-telephone ways. Many are asking to meet their customers in person. While it is not clear whether or not these tactics are still in violation of the new federal laws, it is clear that new customers are still falling for their false promises and misleading advertisements.

Another new tactic that debt settlement companies are employing is lawyers or calling their company a law office because attorneys are exempt from following the federal regulations. However, in many cases, scammers are simply posing as lawyers as an excuse to collect up-front fees or lead customers on.

What can you do to protect yourself? Be very wary of debt settlement companies, ask a lot of questions, and do not pay an up front fee unless you are confident that you are working with a valid company.