Honest Debt Companies -- An Oxymoron?

Where to find honest debt companies

Dishonest debt counseling and debt companies are in the news all the time, and their growing presence overshadows the presence of those companies that have been around for awhile and are reputable. In most instances, debt "counseling" is a misnomer. Most of these businesses (even those with a good record) are no more than repayment services that take your credit card debts, consolidate them (often at a negotiated interest rate), and pay them for you on a monthly basis from the money you pay to the service. Given that this is what they do, and that this is how they make their money, their employees are not trained to analyze whether you should be consoidating your debts at all. In some instances, the best advice may be to pay nothing to most of your creditors, but you're not likely to hear this kind of advice from a debt counseling company.

Still, debt counseling is going to become an important resource for consumers if bankruptcy reform legislation is enacted because fewer people will qualify to have their debts immediately discharged in bankruptcy. Existing companies and those that haven't even emerged yet will be poised to take advantage of more innocent people who believe they have nowhere else to turn.

So, how do you find the honest debt companies? There's no rating system that I've ever heard of, so individuals are left to choose by process of negotiation. You can go to discussion forums and post an inquiry and get responses from people who've been through it. At a minimum, you should check with the Better Business Bureau to see if certain "honest debt companies" are members (don't deal with any that are not members), and to see if there are any bad reports. You'll find that many of these "honest debt companies" are not even registered with the BBB, and that they have negative reports which have not been responded to. So, you do your process of negotiation by knocking off your list any "honest debt companies" that spam you incessantly, checking with the BBB, and asking lots of questions. And if you feel hesitant about moving forward with debt consolidation, that may be your instinct for self-preservation kicking in. Pay attention to it.