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3 Important TSR Guidelines To Consider When Getting Debt Help

man shouting at a phoneWhile people are capable of finding debt freedom on their own, getting debt help makes it a whole lot easier. For some, this is a necessity because they do not have the qualities that will make debt relief a success.

If you think that you are one of them, you need to be careful when selecting the debt relief company that you will hire to help you. There are many scammers out there who will get your hard earned money. Instead of solving your debt problems, they will put you further into the crisis that you are in.

An article published last 2013 in the Better Business Bureau site discussed the results of a study conducted by the Federal Trade Commission. According to the study done in 2011, more than 10% of American consumers have been scammed. The results discussed in the article revealed that 25.6 million adults have at one point in their lives, been victims of fraudsters. Of that number, 1.5 million are victims of debt relief scams.

When you are getting debt help, you have to make sure that you will not be a part of this statistic. It does not take a rocket scientist to do it. If you are intent on getting help from debt professionals, you need to know about the Telemarketing Sales Rule (TSR).

Role of the TSR in the debt relief industry

There are many debt relief laws that protect consumers from being scammed. People in debt can sometimes get desperate and that makes them more susceptible to be fooled by thieves. Make sure that does not happen to you. It is vital for you to keep a clear head so you can protect yourself from these people. And that protection, begins with knowledge. If you are going hire a debt relief company, make sure you read the Telemarketing Sales Rule first.

So what is the role of the TSR in the debt relief industry? According to the publication from the Federal Trade Commission site,, the TSR was created to:

  • Help combat fraudsters especially those selling false services/products through telemarketing.

  • Provide consumers with privacy protection.

  • Aid consumers to defend themselves against illegitimate telemarketers.

  • Guide consumers to determine the legitimate from the the illegitimate companies.

  • Prohibit the calling of consumers who listed themselves with the National Do Not Call Registry.

  • Give companies with guidelines to keep them from misleading or abusing consumers.

As you can see, knowing the TSR will guide you as you are getting debt help. It will keep you from being scammed because you know how the legitimate companies should act. If a company violates this rule, you will know immediately and that will keep yourself from being scammed.

3 important qualities of a debt relief company, according to the TSR

Some people are scared of getting debt help because they are skeptics. Although the presence of scammers are there, you have to know that there are also sincere and trustworthy companies out there.

To help you find the best debt relief company who can help with your credit problem, you may want to consider these 3 qualities based on the TSR guidelines.

Does not ask for upfront payments.

A clear and early sign of a debt relief scammer is when they ask you to pay them even before they have done something for you. No legal debt relief company will violate this rule. Most of them will offer free initial consultations and will never ask you to pay upfront fees. According to the TSR, they are only allowed to ask for any form of payment once they have provided proof of their compliance with any part of the contract. This includes debt payment plans, documented agreements with the creditor, and/or payments made that is according to what have been agreed upon. It has to be noted, though, that this law allows debt relief companies to set up escrow accounts to help secure their payments.

Complete disclosure of process, fees and relevant information about the company.

Another quality that you need to look out for is the full disclosure of information – especially with the fees. Before you sign any contract, it has to be clear with you what will happen and the costs involved in the process. They cannot ask you to pay something in the midst of the program that is not included in the original contract or discussed before the start of the debt solution.  The debt relief company should inform you about the consequences of each debt relief choice that you have (e.g. credit report implications, etc).

This particular rule also protects the money of the consumer. In most cases, the consumer is asked to open an account where they will put their money for debt payments. This is where the debt relief company will get the money to send to the creditors. This rule mandates debt relief companies to ensure that these accounts are to be FDIC insured and that the customer will maintain full control over it.

Should not misrepresent their services.

Apparently, there are companies that advertise certain services and promises results that are not entirely truthful or guaranteed. They do this to entice clients to sign up with them. When the clients sign the contract, that is when they find out the real score regarding the company they are getting debt help from. The TSR prohibits these kind of deceptive measures and consumers are encouraged to report violators.

If you are certain that you cannot find debt relief without professional help, then we highly encourage you to go to the FTC website to know more about the Telemarketing Sales Rule.

Debt solutions that does not require professional help

You should know that there are ways for you to achieve debt freedom on your own. It really depends on the type of debt solution that you will choose to follow. In most cases, people only need to restructure their debt payments to make it more organized and affordable. Here are four debt relief programs that you can use as a do-it-yourself debt solution.

  • Snowball/Avalanche Method. These two methods simply requires you to list your debts according to priority so you can pay a bigger amount to your priority debt while paying the minimum for the rest. For the snowball, the priority will be the lowest balance. For the avalanche, the top debt will be the one with the highest interest rate. Obviously, the first debt will be paid off faster and when that happens, the funds from that will be transferred to the next priority debt – and so on and so forth.

  • Debt Consolidation Loans. This option involves getting a loan that is enough to pay off your multiple debts. Once approved, you will pay everything else and you will concentrate on this one debt. The goal is to simplify your payment plan by consolidating it under one lender. In most cases, the new loan will mean a lower interest rate – especially if most of the debts are credit card accounts.

  • Balance Transfer. This debt relief program involves transferring the balance of high interest credit cards into a new zero interest balance transfer card. These card are still like credit cards but you can transfer your credit card debts to take advantage of the 0% interest. Any payment made would be credited to the principal debt and will not accrue interest. This promo is only effective for 6 to 18 months so you have to create a payment plan to significantly pay off your debt within this period.

  • Debt Settlement. Lastly, you have debt settlement or debt negotiation. There are companies who offer debt negotiation services but this is a debt solution that you can do on your own. Do-it-yourself debt settlement is possible as long as you know the rules and your rights as a consumer. All it takes is for you to convince your creditor that you are in a financial crisis and negotiate for them to allow you to pay only a portion of what you owe (e.g. 40 cents to a dollar). When they agree, you will pay the settlement amount and the rest of your balance will be forgiven.

Be Careful Of Debt Relief Scams: Tips To Protect Yourself

scammer surrounded by billsIn September of 2013, the federal court in the State of Florida helped the Federal Trade Commission (FTC) in their quest to crack down the lingering debt relief scams that are trying to prey on struggling American consumers.

According the the press release found on the site, the court found the defendants to be guilty of violating the FTC Act by doing the following:

  • Misrepresenting the interest rate reduction services on credit card debts.

  • Misrepresenting policies about refunds.

  • Sending unauthorized billing to consumers.

  • Direct violation of the Telemarketing Sales Rule.

This is just one of the many stories of fraudulent companies that the government is trying to track and shut down to protect the unsuspecting consumers. They are actively campaigning to help consumers learn how to avoid debt relief scams so they will not be swindled out of their hard earned money.

Illegitimate debt relief companies prey on the desperate

The thing about debt problems is it will really cause you to go for desperate measures just to save what little money that you have left. Some people are attracted by “too good to be true” campaigns that are simply just that – too good that it ends up being a fraud.

The Better Business Bureau ( reports that in 2011, the FTC reported that 10.8% of Americans are a victim of fraud. That is equivalent to 25.6 million. The survey from the FTC that was discussed in the BBB article mentioned how most fraud cases happen online. Although the convenience of transacting on the Internet is there, you need to be very careful because a lot of people are easily victimized by all sorts of scams. One of them are debt relief scams.

Among the type of scams on the survey, Credit Repair rank 6th place with 1.7 million victims. On 7th place are debt relief scams that victimized 1.5 million consumers. Mortgage relief scams rank number 10 with 800,000 victims.

According to the FTC survey, a high percentage of the victims did not finish high school or have had a recent negative experience like divorce, illness or a job loss. Those who admit to having a lot of debt are also among the people who are most likely to be a victim of these fraudsters.

Obviously, nobody wants to be a part of this statistic. And since these people are really very sneaky, all you can really do is to do your research and find out how they go about scamming people. Here are 5 signs that you are about to be a victim of debt relief scams:

  • Upfront fees. One defining characteristic of legitimate debt relief companies is the fact that they are able to provide services without asking for upfront fees. This is one quick way of knowing if you are dealing with a fly-by-night company or an established one. The legitimate ones try to earn your trust by showing you that they mean business and they are not collecting anything before they have done their job.

  • Fraudulent practices. There are fine lines in debt relief and even in credit repair that scammers are not too scared to cross over. This is a perfect example of the means not justifying the end. One glaring example is being advised to secure new social security numbers. This is a wrong practice and should not be tolerated. Illegitimate companies would be the type to ask those in debt to consider this to start over a clean slate.

  • Absolute promises. Debt is a case to case basis and there are varying degrees of work that is needed to be debt free. But this knowledge comes only after knowing and assessing every situation carefully and looking at different scenarios and debt relief programs. Scammers will most likely skip this critical step and give big promises of eliminating your debt is given at the start

  • Leaving everything to chance. Debt brings an overwhelming emotion of fear and stress. This is a bad combination and we usually jump on the first “lifeline” thrown our way without thinking it through. Debt relief scams know this and exploit this very weakness debtors have. It is tough but composing oneself and checking emotions outside the door before making decisions will go a long way.  It is important to know the background of the companies by researching first and dealing with them after.

  • Foregoing the fine print. There are people with a knack for reading between the lines. But this should not be the case with debt relief companies. The fine print explains all the general and vague clauses in the agreement. This explains all the details of the contract between debtor and debt relief company. Once you are forced to sign right there and then without being given time to read the fine print, better think twice about the company you are transacting with.

When faced with the decision of choosing a debt relief company to work with, keep in mind these  tips to avoid falling into the trap of scammers.

The TSR: how to spot the illegal ones

The Telemarketing Sales Rule (TSR) is a law that provide consumers with the protection they need against malicious companies that offer debt relief scams. According to the release about the TSR, companies who do not follow these rules are most likely operated by scammers. One of the latest addition to this law is covering not only outbound calls but it includes inbound calls as well.

Here are the important points in this debt relief law that will help you determine the legal companies from the not.

Illegal upfront fees. TSR has made it illegal for debt relief companies to front-load their fees. This is meant to protect the consumers because illegal companies will just collect fees and just prolong your debt problems or worse, disappear without a trace.

If the debt relief company is doing multiple settlements for you one after the other, they are allowed to collect after every successful negotiation with your creditors. Another option is similar to an escrow account where you deposit money to a separate account meant to pay the debt relief company after the transaction is done.

Disclosing information prior to closing. Being an advocate of consumers, the TSR compels all debt relief companies to disclose all basic and pertinent information to their potential clients before signing them into a contract. This protects the consumers by ensuring they are well aware of all aspects of the contract before signing.

This could include the timeline on when the debt relief company could deliver on their promise. It could also be about the costs involved and how much all the fees would be paid at the end. Another would be the negative effects of employing their services in terms of credit standing. These and more are important to be reminded of before signing any contract.

Misrepresentation. Illegal debt relief companies will promise you the stars and the moon just to get you to sign. This is in violation of the TSR too. Debt relief scams will promise you a huge reduction on your debt and most probably in a short span of time. These are too good to be true and they might be. Ensure that the services being offered by your debt relief company are legitimate and something they will be able to accomplish for you.

If you want to file a complaint on debt relief companies that scam people, visiting the FTC website at or calling 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261 can get you talking to the right people in no time.

Learn what you can about these laws and your rights as a consumer. That way, you will be protected from debt relief scams. They always come up with new ways to trick you out of your money so make sure you will stay vigilant.

Choosing A Debt Relief Company Through Organizations

couple talking to a counselorGetting out of debt is tough and if you want to make things easier, you have the option to hire a debt relief company to lend their expertise. You can also benefit from the working relationship that they have with the creditors that they will be negotiating with. Their years of experience that they will bring will certainly help you cope and solve your debt situation.

However, you have to take extra care in selecting the company that you will use. There are scammers out there who are preying on desperate people in debt. They charge you high upfront fees and does nothing to make your situation a whole lot better.

And even if you are searching through legitimate ones, you want to know how you can choose the best debt relief companies that can help you achieve a fast and long lasting debt freedom.

Benefits of finding a company to help with debt through organizations

This is where reputable organizations and associations can help you out. If you want to search for a debt relief company that is both reliable and trustworthy, start your search by looking at debt relief organizations that will define who the legitimate companies are from the not. Although searching for reviews on debt relief companies will help you out, you still have to look at their affiliations and the organizations they are a member of. Why not start looking at the right place already?

Here are the benefits of starting your search through these groups.

Higher chance of finding trustworthy companies

No organization will intentionally put a disreputable company in their membership list. They will conduct their own due diligence and ask these companies to submit documents that will prove they are who they say they are. They will also be asked to pay a membership fee and you can expect that scammers will not be willing to pay for this amount.

List of qualifications

These organizations and associations will list in their websites the qualifications of the debt relief companies that they will accept in their group. These qualifications include a particular certification for the debt professionals they employ, list of services, etc. Some organizations will even ask companies to have their employees undergo a special training program with them before accepting them as members. These are all meant to improve the reputation of the organization so that they can attract more debt relief companies to join the group. If you like the qualifications that is written on the manuals of the organization or association that you are looking into, you will know what to expect from their members.

More compliant with the law

Since the organization also has a reputation to take care of, they will not be likely to tolerate companies in violation of the law. They will encourage and mandate that their members strictly follow the Telemarketing Sales Rule – the main law that covers debt relief companies.

There are many organizations that will help you get the list of reliable and trustworthy debt relief companies. These include the American Fair Credit Council (AFCC) and the National Foundation for Credit Counseling (NFCC). You can also look at organizations that their employees are specifically a member of. For instance, debt negotiators should be a member of the International Association of Professional Debt Arbitrators or IAPDA.

If a company is not a member of any organization, you can be sure that there is something fishy about them. But even if the company you are eyeing to hire is a member, you may want to conduct your due diligence still.

Other areas to look into when choosing a debt professional to hire

Most of the time, the organizations are private ones that reputable debt relief companies have created to help build their credibility. Some of them may be endorsed by government agencies and if they are, that will make them even more reliable. For instance, the US Chamber of Commerce also have debt relief companies as their member. In fact, National Debt Relief is a part of this group. If you are looking for credit counselors, you can look into the accredited companies by the US Department of Justice. You can visit the site to view the list of credit counseling agencies that they approve of.

When you find the debt relief company that you wish to perform due diligence on, you may want to visit these other sites too.

  • Better Business Bureau – this is the company where consumers file their complaints and they monitor if the company resolved that complaint. It will help you determine how the company deals with any customer dissatisfaction. You can visit to search for records about the debt relief company you are looking to hire.

  • State Attorney General – every state has an Attorney General where consumers can also file complaints to. If you want to make sure that the company you are going to deal with is indeed reliable, this is another area that you can check out. Go to the to find out the contact details of your State Attorney General. Give them a call to do a background check on the debt relief company you are researching on.

It is very important that you conduct your own background check to ensure that you are putting your trust in the right debt relief company. Here is a video that you can watch to further educate you about finding the right company to help with your debt problems.

Reviews To Find The Best Debt Relief Company

Debt settlement can be a great way to get your finances under control and to get out of debt. However, it’s important to understand that there are some debts that can be settled and some that can’t. It is possible to negotiate settlements on what are called unsecured debts, such as credit cards and personal loans. However, it is not possible to settle secured loans or those that have been secured by an asset such as your automobile or house.

Debt settlement isn’t for everyone

If you owe less than $5000, it probably doesn’t make sense to hire a debt settlement company.  You could be better off trying to settle the debts yourself as the cost of using a debt settlement company might be prohibitive vs. the amount of money the company would save you. Also, if you owe so much it seems unlikely that you will be able to make any payments at all in the near future, filing for bankruptcy might be a better option.

Third, how much you could save through debt settlement will depend on who are your creditors, how delinquent you are, the types of purchases you have made, whether or not you have payday loans and if you have made any credit card balance transfers.

What to look for in the top debt relief companies

Reviewing the top debt relief companies based on these criteria:

  • Can provide different programs tailored to your personal needs
  • Up to date membership in a Chamber of Commerce
  • Belongs to the American Fair Credit Council (AFCC) or the Associate of Settlement Companies (TASC)
  • Membership in the Worldwide Association of Professional Debt Arbitrators
  • Provides fast customer support
  • Has a high customer satisfaction rating
  • Offers flexible programs according to what you are able to pay monthly
  • Works with personal debt, mortgages, taxes owed and loans to provide the best possible help

Since National Debt Relief is a debt relief company you would expect us to toot our own horn and say we are the company you should work with. However, do not take our word for it. There are independent review sites that have made their own decisions:

Check out this review on

Check out this review on

Watch out for shysters

If you are an individual or the owner of the company looking for help with your debts, there are companies out there that can help you reduce them and get control of your finances. But it is important to pick a reliable and trustworthy debt settlement company such as the three I have listed here. It is unfortunate but true that there are debt settlement companies that just cannot be trusted. They will take the money you have paid them and, instead of using it to pay off your debts, will simply keep it. And by the time you learn what’s happened, it may be too late for you to do much about it.

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