Spotting Fake Credit Counselors

The fact that some people will put more effort into stealing than earning is absolutely mind boggling. This is particularly true when you consider that the potential benefit seldom outweighs the potential cost should they get caught. The good news is that most of them, including fake credit counselors, follow the same playbook. Here’s what to look out for.

Pie in The Sky Promises

Anyone who says they can make all of your debt go away in a few months, with very little effort on your part is lying. It usually takes a while for debt problems to accrue, so it takes a while to clear it up too.

Moreover, a claim they’re the only ones who can help you is another red flag of fake credit counselors. The reality of the situation is there’s nothing a credit counselor can do for you that you cannot learn to do for yourself. However, it takes time to master all the ins and outs, so it can be better to have an experienced individual in your corner advising you of the best way to proceed.

Further, anyone promising to raise your credit score by a certain number of points in a short amount of time is also banking on snaring you with false hope.

Failing to Apprise You of Your Rights

Reputable credit counselors have no problem telling you about all of your rights as pertains to the situation. And, yes, you do have rights. The Fair Debt Collection Practices Act spells out all the abusive, harassing and unfair debt collection practices against which you’re protected.

Credit counselors who have your best interests in mind will tell you about the Act, as well as things you can do without their assistance to resolve your situation. For example, you can write to credit bureaus on your own to challenge information in your credit report — but nefarious operators won’t inform you of that. Instead fake credit counselors easily attempt to charge you a fee to do something you could do yourself.

Now, with that said, there are advantages to having a professional conduct certain transactions on your behalf, but they’re supposed to tell you about your options first.

Requesting Payment Up Front

The fact of the matter is most services provided by credit counselors are offered for free or at little cost — aside from debt management. Either way, anybody asking for money before they’ve provided a service, is probably looking to take your money and ghost you.

Recommending Debt Management Before Evaluating Your Situation

Debt management is a legitimate service credit counselors provide.

However, it isn’t always the best solution. Some people will try to make the whole world look like a nail because all they have is a hammer. They won’t offer you any other option to consider because that’s the only one from which they can profit.

In other words, they’re trying to rope you into a relationship in which you’ll pay them on an ongoing basis for a solution that might not be the best one for you.

Credit card debt relief, consolidation loans and sometimes even filing for bankruptcy protection can be more effective in certain cases. An honest counselor will review your finances thoroughly before making any sort of recommendations at all.

These are four of the most common tactics to look out for when spotting fake credit counselors. The Federal Trade Commission offers consumers additional information along these lines to help you avoid making a bad situation even worse.