You are happy after availing the services of a debt consolidation company and hope that now it will be convenient for you to pay off the debts. Further, you might heave a sigh of relief since all the creditors will now be handled by that company. You might be mistaken. The debt consolidation company might not be paying off your debts. It might be hoodwinking you. It might also be colluding with the lenders to generate false reports. The money may be going out of your bank accounts but is it getting deposited in the lender’s account? To rid of all these troubling questions, it is essential to maintain a strict vigil and proper practices and accounting norms while dealing with these companies. Here is a checklist of what is to be done:
1. Read the agreement carefully. Do take your time in reading this vital document. Look for unreasonable clauses and any hidden costs. Also, look for the duties and responsibilities of the company and for the penalty/punishment provisions in case it fails to perform its duties.
2. It is always better to pay by way of check rather than cash.
3. If the money is routed to creditors through the debt consolidation service company then ask for proper receipts of the payments made to them. The receipt shall be genuine bearing the registration number or license number of the creditor.
4. Take a ‘receiving’ of the check that you have made out to the company. It shall be duly stamped and signed by some authoritative person.
5. Keep a regular check on your bank balance to know whether the amounts are being regularly debited.
6. Keep in touch with the lenders to confirm that they have received their dues.
It is important to remember that by taking the services of debt consolidation loan company, you are not transferring your primary responsibility to pay off the debts. It is merely is a service provider and does not become a debtor itself. You must take all steps necessary to ensure that the company is not interested in taking its fees only but also works as promised.
So, it is quite clear that the work is not over by hiring a debt consolidation company but, in fact, the nature of work changes. Now, you will have to be vigilant and ensure that everything is done through right channels and with proper documentation support.
