1. Completion Rate: Fewer then 40% of the people who start a debt consolidation program with companies that are not law firms complete it. The success rate of law firms is close to 90%.
2. The truth about non profit debt consolidation companies: The IRS found in its investigation that non profit debt consolidation companies are actually fronts for funneling the money to other companies. Hence, IRS has closed down many such companies.
3. The truth about for-profit debt consolidation companies:
   • Creditors are under no legal obligation to listen to these companies because they are not law firms. Hence the collection calls do not stop.
   • These companies charge approximately 15% of the debt amount as upfront fees. The initial monthly payments go towards paying the upfront fee. After the fees are paid the company has no incentive to retain the client because the fees are not proportionate to the money saved for the client.

Here are the recommendations of our community:

They can take the help of a law firm to resolve your debt problems since:

1. Stick of bankruptcy: They can use the stick of filing for bankruptcy to make the creditors agree to debt consolidation or settlement program.
2. Carrot of trust account: A law firm can help you establish a trust account and can use the balance in the trust account as a bargaining chip.
3. Stop harassing calls: They can make the creditor stop calling you - FDCPA says that creditors can not call you if a law firm is representing you.
4. Step down approach: A law firm can always file for bankruptcy if you can not afford the monthly payments of being in a debt management or a debt settlement program.

How to choose a law firm?

1. BBB Member: The Better Business Bureau (BBB), founded in 1912 keeps a file on its member companies. Consumers can call the BBB to file complaints. A business that does not have any filed BBB complaints is a good sign.
2. Success fee: A law firm should be able to put its money where its mouth is. If they are so confident of saving you money they should make a part of their fees depending on the amount of money they save you.
3. Success stories: If the law firm's sales pitch says that they can deliver results to you ask them to show you some success stories of past clients. For example, if you have The Bank of America as a creditor ask the law firm to show you a settlement letter from the bank for one of the law firm's past clients.
4. Offer fee credit for step down: If you join a debt management or debt settlement program they should offer you a step down from management to settlement to bankruptcy if your financial situation worsens. This increases the chances of your completing the program. Refer to the shocking fact above about completion rate at the top of this page.

Why should you believe us?

1. We are BBB accredited business with 0 complaints in the last 5 years since our founding in 2003.
2. We are a community and not a debt consolidation or debt settlement company: We do not earn money by signing you up for debt consolidation program or debt settlement program. We earn money by our advertising through Google adsense program and the ranking chart.
3. We are the only forum about debt that is not censored.
4. Our community has more than 117,000 members and over 30,000 topics in our forums.