Debt negotiation services can be an excellent resource if you are looking for an alternative to filing bankruptcy. These services will help you negotiate a lower payoff amount with your creditors.

There are many debt negotiation companies out there, and while many are reputable, just as many are fraudulent, deceptive, and even illegal. Finding the right company to manage your settlement is important. Before you sign up with a company, make sure that it is licensed to operate in your state by contacting the Attorney General. Also check if it is rated well by the Better Business Bureau. For additional assurance, find out if the company is accredited by either the United States Organization for Bankruptcy Alternatives (USOBA) or The Association of Settlement Companies (TASC).

Next, find out what kind of fees the company will charge you. A consultation should be free, but there are usually some small application or appraisal fees. Then most companies charge a fee based on your savings - usually about 20% of the forgiven debt. Beware of companies that ask you to pay a fee upfront for a guaranteed settlement - this is illegal. Reputable companies will never make such claims and will not charge their fees until after a settlement is made. Another important factor is how your money is kept as you wait for it to accumulate. A reputable company will set up a trust for you that is FDIC insured - meaning that if the bank it is held with folds up, you do not lose your money.

Finally, check through the company's profile. Find out how long they have been in business, what kinds of services they offer and what their success rate is. If possible, read testimonials, or even ask if you can speak with someone who has used the service in the past. Read reviews on line as well to make sure you are working with a company that will get you results in a legal, fair way.

With a little research, you can find a debt negotiation service that will help you get out of debt, not put you deeper into it.