FTC Tips for Consumers Weighing How to Settle Their Credit Card Debts

by Sabrina I. Pacifici on April 12, 2010

News release: “Consumers with overwhelming credit card debt may be tempted to seek help from companies that promise to erase their debt for pennies on the dollar, but the Federal Trade Commission urges caution. In a new consumer publication, Settling Your Credit Card Debts, the FTC says that there is no guarantee that debt settlement companies can persuade a credit card company to accept partial payment of a legitimate debt. Even if they can, clients must put aside money for their creditors each month and may have to pay hefty fees up front to the debt settlement company – putting them further in the hole before they get any relief. The publication lists additional red flags to watch out for from companies that promise to settle credit card debt, and discusses practical no-cost and low-cost options for help, including dealing with creditors directly and contacting a credit counselor.”

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