If you're in a financial bind, you've probably at one time or another asked yourself, "what do I do now?" Effective solutions for severe financial problems are limited, and not always pretty. Do you declare bankruptcy to pay off your debts? Take on more loans or credit cards? Maybe you've even considered debt settlement as a way to reduce your overall debts by paying one lump sum payment. The problem with debt settlement companies is that there are plenty of phonies out there looking to snag a buck from a helpless victim. So how do you tell who's legit and who isn't? What badges of honesty are out there to prove a company's dependability?
According to Best Company, there are three particular organizations that serve as a good measure of legitimacy: the American Fair Credit Council, the Better Business Bureau, and the International Association of Professional Debt Arbitrators.
The American Fair Credit Council operates on three basic principles:
The AFCC was founded in 2011 by debt companies whose goals included full compliance with Federal Trade Commission regulations. The organization rose from the ashes of The Association of Settlement Companies after its founders discovered the organization wasn't keeping up with the rapid changes in the credit industry. AFCC members don't handle consumers' funds, and consumers don't pay a fee until their debts are resolved.
The Better Business Bureau (BBB) was founded in 1912 and operates as a nonprofit organization that gauges marketplace trust. Before 2008, the organization operated solely off a "satisfactory" or "unsatisfactory" rating system, but since then, the organization's rating system has followed a school-like rubric, rating companies on a scale from A+ to F.
The BBB Partner Code of Conduct follows six guidelines:
Accreditation by the BBB means a business has paid a fee to be reviewed against the BBB's accreditation standards. The accreditation doesn't signify an endorsement of products/services or even a guarantee on the quality; it mostly means that the businesses are willing to go the extra step to resolve customer complaints on the BBB website.
The International Association of Professional Debt Arbitrators (IAPDA) started in 2000 when the debt settlement industry was still small and growing. What the IAPDA sought to do was build online training and certification programs for individuals providing debt settlement services. The company claims to be the gold standard for qualification training in the debt settlement, credit counseling, and student loan industries.
Since the program is focused on individuals, entrepreneurs can become IAPDA-certified as well as major corporations. When an individual passes the IADPA certification process, the customer can feel sure that the individual classifies as a Certified Debt Specialist, Certified Credit Counseling Specialist, and Certified Student Loan Professional.
As time goes by, more and more states are instituting laws that indicate you can only work with debt companies that are trained and certified. This means that those who are already certified through IAPDA are industry-respected specialists that are keeping up to date on current debt relief business laws and requirements.
Accreditations serve as badges for companies marking legitimacy, expertise, and experience. Customers should recognize companies with these certifications as quality companies to do business with.
Best Company has listed among their grading criteria what debt settlement companies are accredited with all of these institutions. Some of these companies include Freedom Debt Relief, Pacific Debt Inc., and Accredited Debt Relief. Appropriately, all of these companies have achieved a rating of 8.5 or higher based on hundreds of consumer reviews. A full list of debt settlement companies can be found on our website.
November 23rd, 2022
July 22nd, 2022
Sign up below to receive a monthly newsletter containing relevant news, resources and expert tips on Debt Relief and other products and services.