Janie Writes in “Are Debt Counselors Safe?”

Posted by Steve Rhode

August 28, 2008

Janie wrote me and asked me the following question:

“I’m running into deep debt and I’m thinking of using one of the debt counselors I’ve seen on my local television station to help me get out of debt. Are they safe?”

Janie,

Well you’ve come to the right place for an expert answer. If you are concerned about the safety of your money, the answer is almost always yes, your money is safe with a debt counselor. While there have been some horror stories of a few debt counseling groups losing client funds because some employee stole them, that is the exception. In that case the company insurance policy should provide restitution for employee theft.

People always want to know if the debt counselor is going to run off with their monthly payment. Logically it does not make sense for the company to do that. Your monthly payment is probably so small that it would be illogical for the company to ruin their reputation and risk legal action over that.

I’ve never seen a company skip town over a monthly payment from a client of $500. That just does not happen.

There are things you can do to safeguard your money.

Watch your creditor statements and look for your payment from the debt counselor made to the creditor.
If the debt counselor has an online resource for you to check your account, logon and check the status of your payment.
Ask the debt counselors for an itemization of the payments they have made on your behalf.

Big hug.

Steve

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