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7 Debt Scams You Need to Be Aware Of

There are many reasons as to why someone would fall behind on making their bill payments. These include mortgage payments, job losses and medical emergencies. Due to the fact that handling debt collectors and debts can be a very overwhelming and even frightening process, it is very important to be very wary of all the components that go into falling in debt. This is especially the case as there is a number of debt scams out there that you can easily fall into if youق€™re not careful. Here are seven debt scam signs to avoid.

1.آ  Fake Debt Collector

This scam is very simple and straightforward. Typically this type of debt scammer will call you in order to attempt to collect your debt by posing as a legitimate collection agency. In most cases the scammer will have already gained access to some of your personal information by stealing your identity or getting a hold of your credit report. Through doing this, they can seem like a real collection agency attempting to collect the debt that you actually do owe, which can make this scam seem like itق€™s very believable.

2.آ  Credit Card Debt Collection

A common debt scam is one in which a scammer attempts to collect on your credit card debt. For instance, someone may attempt to convince you that they are collecting on your American Express debt, and due to the fact that you really do owe money, it can be easy to be convinced that the scammer really is calling on behalf of American Express, however in reality they will have no relation whatsoever to them. Whatever money you end up giving to them will be going into a scammerق€™s pocket and not American Express. On top of this, scammers may be able to access other funds gained from the financial information they were able to obtain from you.

3.آ  Harassment

One way that debt scammers get you will be by harassing you with phone calls and emails in order to frazzle you enough that you send them money. Some scammers will even send you multiple credit disputes from legitimate credit reporting agencies in order to convince you to send them over money. In some instances they will try to convince you that you need to create a new social security number or a new employer identification number. This is both fraudulent and illegal

4.آ  Attempt To Get You to Wire Money

The whole point of debt scams is typically to get money from you. One of the easiest ways of doing this is to try to convince you to wire over money or hand over a prepaid card. A scammer may ask you to send over money from a Western Union or may ask that you load a prepaid debt card and hand over the card number to them. They will try to convince you that it is an easy method of repaying your debt when in reality your money will just disappear before your eyes if you fall for this scheme.

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5.آ  Payday Loan Debt Scam

Payday loan debt collection scams are some of the most common types of debt scams. It is a very common practice for these types of scammers to steal or even buy payday loan information in order to target those who use payday loans. Scammers will sound like a legitimate payday lender attempting to collect the debt due to the fact theyق€™ll have all of your information. Keep in mind that a legitimate payday lender has to follow the Fair Debt Collection Practices Act, and so they will not harass you or threaten you with legal action. They also are not permitted to give out your debt information to others.

6.آ  Willing to Settle

Often debt scammers will use the tactic of convincing you that you owe thousands of dollars, however theyق€™ll settle for a few hundred instead. This way youق€™re feeling as if youق€™re getting a good deal on repaying your debt when in reality youق€™re not repaying the debt at all. Be aware that a real debt collector will not settle for thousands or necessarily even hundreds of dollars less than your debt amount, and so this should raise a red flag for you.

7.آ  Junk Debt Buyers

A very common debt collection scam that many people end up falling prey to is one in which a scammer will offer to pay down an old debt that is close to its statute of limitation. Although you may still be liable to pay this old debt, you will not be taken to court over it. However, a scammer who purchases a junk debt bond may start to harass you to get you to pay debt that should only legally be given to a collectionق€™s agency and not be sold to a junk debt buyer.