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Chicago Sun-Times gives alternatives to debt settlement
01/29/2010
Debt settlement may be considered by some consumers who are deep in debt, though some experts have noted that it could end up putting people into further debt problems.
A recent report from the Chicago Sun-Times noted that the Illinois attorney general's office has already received complaints from consumers about certain debt settlement companies. According to the story, the consumers have paid debt settlement companies for months without seeing any results.
Attorney general offices in other states, including North Carolina and Montana, have also warned that debt settlement companies may end up hurting a person's financial standing. Debt settlement companies work by telling people to stop paying their debts and, instead, to give money to the company, which will then use it as leverage to settle.
Rather than rely on debt settlement, which could hurt a person's credit score, there are other options. The paper noted that experts have said consumers could try to negotiate directly with their creditors. That could lead to a lower rate or a certain amount of debt forgiveness.
Another option may be to go to a consumer credit counseling agency, which can provide people with advice on how to handle their debt.
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