How do I choose a reputable company to assist with business debt relief?
Starting or running a business can be tough, and sometimes things don’t go as planned. If your business has racked up debt, you may be looking for help. Business debt relief companies promise to negotiate with your creditors and reduce your debt burden. But how do you pick a legit company you can trust?
I feel your pain. I’ve been there too as a small business owner. The debt collectors calling every day, the worry about making payroll—it’s stressful! You want help but don’t want to make things worse. I totally get it.
-The good news is there are reputable companies out there who can help in a big way. The key is doing your homework to find one. Here’s my advice after going through this myself:
Look for experience & credentials
You want a company that knows what they’re doing and has a track record of success. Look for ones that have been around for a while and have helped lots of businesses like yours. Check that they have knowledgeable lawyers and accountants on staff. You can ask for their credentials. Experience negotiating business debt is a must.
A good sign is if they belong to trade groups like the American Fair Credit Council (AFCC) or the Association of Settlement Companies (TASC). Members have to follow ethical codes and meet standards.
Read reviews carefully
Reviews can give you a good feel for a company’s reputation. But watch out for fake ones posted by the company itself. Focus on reviews on independent sites like Trustpilot and the Better Business Bureau (BBB). Are most reviews positive over many years? That’s a good sign.
-Look out for complaints about dishonesty or not delivering on promises. Run away if there are lots of these! One or two can happen to any company. But a pattern is a red flag.
Vet the company legally
Make sure the business is legally on the up and up. Are they registered in your state? Check with the Secretary of State office to see if they are a registered business.
Ask if they have any lawsuits or legal issues against them. Ethical companies will be transparent if issues popped up. Look up the company and its executives online for any legal problems or bankruptcies. Major red flags there.
Understand the debt relief process
A reputable company will explain exactly how they’ll help you. You shouldn’t feel confused.
They should go over your options like debt consolidation and settlement. Ask how they’ll negotiate with creditors and get debt reduced. Make sure you understand their fees and when you pay them.
-If a company just promises to make debt go away without details, be very cautious. Debt relief takes hard work and time.
Look for fair & transparent fees
Fees vary but watch out for really high or hidden ones. Companies usually charge a percentage of debt enrolled or saved. 15-25% is typical. Monthly fees should decline as your debt is reduced.
Read the contract carefully! Check for sneaky charges like monthly account fees. Get fee examples based on your debt amount so you know the total cost.
-A good company will be upfront about their fees. You shouldn’t find surprises down the road.
Try debt relief alternatives first
Going straight to a debt relief company may not be your only option. Depending on your situation, you may want to try:
- Asking creditors directly for lower payments or waived fees. Sometimes they’ll work with you.
- Working with a credit counseling agency for free budget help and advice. They can set up debt management plans.
- Filing for bankruptcy as a last resort if your debt is totally unmanageable. This wipes out many debts.
- Simply working out payment plans yourself with each creditor. This saves on fees.
While more work, these options are worth considering before hiring a company. An honest company will talk through all your options, not push their services.
Don’t fall for high-pressure sales tactics
Run away fast if a company tries to pressure you into signing right away. They may say things like “this offer ends today!” or “spots are limited!” This is a big red flag for a scam.
A reputable company will give you time to review options, check them out, and make the right choice for your situation. Debt relief is a big decision. Avoid any company that rushes you.
Read the fine print!
I can’t say this enough: read the contract! Debt relief companies should provide a detailed, written contract spelling out their services and fees. Never sign something you don’t understand.
Watch for things like mandatory arbitration clauses that limit your right to sue. Make sure you can cancel without big penalties. Get all verbal promises in writing.
Ask an attorney to review the contract if you’re unsure. It’s worth getting professional advice before signing. Don’t get pressured into signing on the spot.
Trust your gut
Even after doing your homework, go with your gut. Do you trust the company and the people you talk to? Do they seem genuinely interested in helping your business vs. just making a quick buck?
If your gut says no, listen to it and keep looking. You’ll find the right company that feels like the perfect fit.
The bottom line
With some diligence, you can find a reputable debt relief company to help your business. Look for experience, transparency, fair fees, and no pressure sales tactics. Check reviews and legal standing. Make sure you understand their process.
Debt relief can be a lifesaver but you need to choose your partner carefully. Follow these tips and you’ll find a company you can trust to negotiate your business debt and get you back on track. Wishing you all the best! You’ve got this.