The irresponsible use of credits can lead some people to fall into a spiral of debt. When the borrowers (the people who received the credit) can no longer pay, they can turn to the institutions known as credit repairers. If you are also thinking of hiring the services of one of these companies, we invite you to read the article prepared by our team of advisors of Vivus Mexico.
Debt repairers are companies that offer their services to negotiate the payment of a debt when the credits have surpassed the capacity of a person. Although they work as a mediator between the creditor (a bank, financial institution or departmental store) and the debtor, these companies do not have a legal status. According to the Condusef, debt repairers are not supervised by any government body, so it is impossible to file a claim with this commission or any other public institution if a problem arises with these companies.
Credit repairers design a savings plan for debtors to collect a certain amount of money. Once they have collected a significant amount, the repairers negotiate directly with the creditor the payment of the debt with a discount. Some companies say they can reduce debt by up to 70%. When the outstanding payment has been settled, the repairers offer their clients financing through a popular financial company so that they can improve their credit bureau rating. Advantages and disadvantages
- They offer financial guidance.
- They deal with the collection offices.
- They help debtors organize their finances.
- They do not have the recognition of the Condusef.
- The cost of their services can be very high.
- The report of the credit bureau indicates that the debt was settled at a discount.
Although the offer of debt repairers sounds very attractive, by leaving your financial commitments in your hands you run the risk of falling into greater problems. There are many companies that promise to negotiate very high discounts on debts, but in reality it is just a scam. If a repairer tells you that she can fix your debt and get you out of the credit bureau in exchange for an advance payment, you can be certain that it is a fraud. In case you have problems to settle your debts, this is what you should do:
- Negotiate a fixed payment plan directly with your bank to reduce the monthly payment amount.
- Consolidate your debts to integrate them into one. This applies in the event that you owe several credit cards.
- Restructure your debt to change the payment terms with your bank.
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