Be Careful Believing the Numbers from Credit Counselors

Before I get started, there might credit counselors out there that are legitimate. I have seen many of these proposals and pored over the numbers.

I have found 100% of the time that the numbers on these proposals are completely wrong. Thus, they are misleading.

I looked at one this morning and they promised this listener that he would be out of debt in 41 months. He has roughly 10 debts. There are so many errors and misrepresentations on this page that I don’t have enough space to detail it all.

Let’s just start out with one. He has a Bank of America debt of $4,742 that he is paying $208 a month and the interest rate is 32%. The company said that they would lower that interest rate to 18% and he would pay $111 a month. Now they say he would be debt free in 41 months.

It would take him 69 months to pay $111 a month at 18%. That is 28 months more than the proposal states. In addition, he would be out of that debt in 35 months if he just kept on the regular schedule.

It is amazing that the Federal Trade Commission allows these companies to operate. The problem is that anyone can get into this business. People often ask me if this is a good solution. As you can see, it is not!

In addition, you run the risk of getting put in collections while in one of these programs. You also run the risk of penalties. You basically face all types of risks by participating.

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