⚠️ Debt relief, credit counseling, and the advance-fee rule

What this actually is

The FTC’s position is unambiguous: "You don’t need to pay a company to talk to your credit card company on your behalf — you can do it yourself, for free," and for student loans the free services exist through official government channels. On fees: "Only scammers will try to collect fees from you before they settle any of your debts." A telemarketed debt relief company may not charge until a debt is actually settled, and then only as a proportionate share as each creditor agreement is finalised. For counselling, the FTC points to credit unions, universities and Cooperative Extension branches, and says a reputable counsellor will review your whole finances before recommending any plan. Ask for the fee in dollars, up front.

Who qualifies, and what trips people up

Nothing to qualify for — this is the rule set that governs anyone selling you debt help. Red flags in order of seriousness: a fee demanded before any debt is settled; a guarantee that debts will be gone; advice to stop talking to your creditors; refusal to state the fee in dollars. A non-profit agency should be able to tell you its 501(c)(3) status and whether creditors pay it.