December 2003

What's New in Finances

Don't fall victim to "quick fix" promises

12/1/2003 -

The IRS, the Federal Trade Commission, and state regulators are warning consumers about credit counseling organizations that are preying on individuals struggling to get their debt under control.

Though many credit counseling organizations provide needed advice and services, some engage in activities that are not in the best interests of their clients. The IRS issued this consumer alert because many of these groups seek tax-exempt status in order to avoid laws regulating their activities.

If you find yourself looking for help with your debt, here are some tips from the IRS on how to protect yourself from deceptive credit counseling practices.

*Read any agreement before you sign up. Check fees, services to be performed, and any guarantees if you're not satisfied.

*Be wary of quick fixes and promises to "help you get out of debt easily."

*Make sure your creditors are willing to work with the organization you choose; then follow up with your creditors to be sure your debt is actually getting paid.

*Check out the organizations you're considering with the Better Business Bureau and your state agencies.

*Beware of high fees and "voluntary" contributions that add to your debt.