Deniese L. Zeringue, Tucker, Jeanette A.
Bogus offers to help consumers save their homes from foreclosure were the fastest growing consumer complaint last year according to research conducted by the Consumer Federation of America (CFA), National Association of Consumer Agency Administrators (NACAA) and the North American Consumer Protection Investigators (NACPI). When times are hard, consumers are more vulnerable to false promises of easy ways to make or borrow money. Other common complaints that are particularly related to the recession include aggressive collection practices, debt settlement and other types of debt relief services, advance fee loans, business opportunities, and business closings, landlord/tenant problems resulting from foreclosures, job scams, investment schemes and auto dealers failing to pay off loans on trade-ins.
Consumers can protect themselves from these recession-related scams and others by following these recommendations:
1. Look at the track record. Before buying from unfamiliar companies, check with the Louisiana Attorney General’s Consumer Protection Hotline at 1-800-351-4889, the Better Business Bureau and/or online complaint forums to see if other people have reported serious problems.
2. Hire licensed professionals. When hiring home improvement contractors or other professionals, consult the Attorney General’s Consumer Protection Hotline to determine if they must be licensed or registered and how you can check to confirm that they are.
3. Pay the safest way. When purchasing goods or services that will be delivered later, pay with a credit card so you can dispute the charges if they don’t arrive or aren’t what you were promised.
4. Use gift cards and gift certificates promptly. Even well-established businesses can suddenly close or go bankrupt, and it may be impossible to get refunds for the unused balances on gift cards and gift certificates.
5. Don’t pay in full upfront. If you are asked for a deposit for home improvement or other services, pay a small amount, never the full price until the service is completed to your satisfaction.
6. Recognize the danger signs of fraud. Be wary of any requests to wire money; scare tactics or pressure to act immediately; promises that you can borrow, win or make money easily if you to pay a fee in advance; and any situation in which someone gives you a check or money order and asks you to send money somewhere in return.
7. Get all promises in writing. Verbal agreements are hard to prove. Carefully read contracts or finance agreements and make certain you understand them before you sign.
8. Seek help for financial problems from legitimate sources. If you are having difficulty paying your bills, consult a non-profit consumer credit counseling service. Avoid debt settlement services that require most or all of the fees to be paid before any of your debts are settled. If you are unable to pay your mortgage, contact your lender and try to work out a loan modification. If the lender is unresponsive or unhelpful, call 1-800-569-4287 or go to http://nhl.gov/offices/hsg/sfh/hcc/hcs.cfm to find a housing counselor certified by the U.S. Department of Housing and Urban Development. Steer clear of unsolicited offers of help from any company except the lender to whom you send your mortgage payments.
9. Know your debt collection rights. Under federal law you have the right to dispute debts that you don’t owe, and many states prohibit action to collect debts after a certain number of years. Federal law prohibits debt collectors from calling with annoying frequency, falsely threatening legal action and discussing debts with people who aren’t legally responsible for them.
10. When in doubt, check it out. If you are not sure what your rights are or you think something might be fishy, consult the Louisiana Attorney General Consumer Protection Hotline at 1-800-351-4889.