Credit Relief Scams

Posted by: Sophie H. | Jan 12,2008


Everyone wants to get out of debt as fast as they can.  No age group wants to get out of debt faster than retirees or those soon facing retirement.  A person in their thirties may indeed want to get out of debt fast, but he’s got the leeway to think he’s got decades in front of him to deal with that debt.  Then again, he may be looking to buy a house in the next couple of years, so debt relief is a necessity.  

Retirees have a specific problem because their going to run out of income at some point in the near future.  At least if you’re buying a home, that debt is a type of investment.  Retirement drains money, rather than gains it (a major argument for having investments that outperform your yearly payments).  All that said, retirees need to find a way to relieve that debt sooner rather than later.  

Much of the talk about scams and the elderly revolves around identity theft.  There are also credit relief scams that prey on seniors who fit precisely this mold: people who cannot afford to be in debt during retirement.  There are a few things to look for in a debt relief scams.  It can be difficult to sort them all out – not all debt settlement opportunities are scams, but some of them are, for example.  Here are some signals that what you’ve found is a scam. 

• High fees: If the company charges up front, it could be a scam.  The problems with this are two fold.  1. The better debt counselors are not-for-profits. 2.  Also, the money you pay in fees will offset what you gain from a settlement.  
• The counselor is approved by the U.S. Trustee Program.  Check out the list here.  
• The credit repair company only offers one option to you.  In reality, you have many options at your disposal and each debtor will have very different needs.  A good credit counselor will have a multi-faceted approach.  Of course you may only find this out after you begin counseling, and if you’ve already paid fees you’ll have to cut your losses, but this should be a pretty clear signal that you should go with a different outfit.  

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