Not all credit restoration companies are created equal

The promise is great to help you get out of debt. But not all debt management companies have your best interest in mind.

Now the state of Florida is going after three companies, Financial Help Services, Nation Wide Consumer Debt Relief and Bobby Blackmon, saying they took customers’ money but didn’t make all the payments to creditors. The Florida Attorney General said these companies promised to help customers, but all they received was more debt. To date, the state has received 470 complaints regarding the companies. Mary Straits of Spring Hill fell victim to a credit repair company years ago.

«I had a lot of debt, and I thought, ‘OK this is cool,’» Straits said.

But even as she handed over cash to those tasked with helping her, Mary’s creditors were still calling constantly.

«They were supposed to pay a portion of all my bills but they did not do that,» Straits said.

After two years she was at the end of her financial rope.

«They had made me go deeper, and they had not used the money for anything,» Straits said.

Melissa Gilkey Mince, a bankruptcy attorney in Largo, says many debt management companies make promises they can’t keep.

«To erase their debt, fix their credit score, take care of lawsuits, stop their creditor calls,» Mince said. «Doesn’t work.»

She said one of the biggest warning signs is when a credit repair company asks you to take out a cash advance loan on your credit card and promises you this:

«Give it to us and we’ll try to negotiate your debt down,» Mince said. «Now, you have a cash advance at 26 percent.»

She said that can get debt-ridden customers in deeper debt. Mince said at the very least, demand answers to the following questions before going with a debt management company.

«How much of the money is going to the creditors? How much of it is going to you? When do you pay my creditors?» Mince told ABC Action News.

Straits doesn’t want other people to fall victim.

«I would tell them not to do it,» Straits said. «They will not get you out of debt.»