COLUMBUS — North Americans owe more than $16 trillion of debt, yet the companies they turn to for help often fail them. That’s the upshot of a 2023 study conducted by the Better Business Bureau.

Logging more than 11,000 complaints and more than 900 negative reviews about companies offering offering debt relief and credit assistance, the BBB delved into the debt relief and debt consolidation industry.

What it found was a pattern of misleading and fraudulent claims, mostly centered on a group of companies in the U.S. West.

What You Need To Know

  • North Americans owe more than $16 trillion of debt

  • The BBB’s 2023 study found debt relief companies often fail consumers, especially a group of companies in the U.S. West

  • The BBB has logged thousands of complaints and negative reviews about debt relief and credit assistance services

  • Consumers don’t understand their options or know they can conduct many of the services these companies offer

The study also looked at credit-repair companies and found many are predatory, charging high fees and making false promises, the BBB said.

When the BBB asked consumers about their experiences, the organization found many companies advertise quick fixes for low credit scores and debt defaults.

But the reality is far different. The BBB found many consumers lost thousands of dollars relying on these companies and ended up deeper in debt than before they looked for help.

Much of the problem with debt is that consumers don’t understand their options or know that many of the services these companies offer can be conducted by the consumer, the BBB said.

To avoid falling to the failed promises made by some debt-relief companies, the BBB offers these tips:

  • Don’t be rushed when seeking help. Many dishonest companies and scammers use high-pressure tactics that scare consumers into rushing.
  • Get your free credit report from AnnualCreditReport.com
  • Be sure to wait until services are rendered by a company before you pay.
  • Make sure to carefully examine any guarantees a company makes. Few debt relief companies can assure you  a credit or debt company will negotiate with them or adjust your reports.
  • You can call debt holders yourself and try to negotiate a lower debt payment.
  • Keep an eye on your monthly bank statements to make sure you aren’t getting recurring charges from companies.
  • Do not give your personal banking information unless you are absolutely sure a company is legitimate.
  • If a company won’t tell you your rights about credit repair or debt relief do not work with them.
  • Avoid working with anyone who claims to be associated with a government agency.

Read the BBB’s study: Credit Repair and Debt Relief: BBB® study finds some companies fail to deliver on big promises.

If you believe a company intends to scam you, report it to the Better Business Bureau or the BBB Scam Tracker.

To learn more ways to protect yourself, read “10 steps to avoid scams.” You also can subscribe to BBB Scam Alerts to get weekly information about new scams.

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