Orange County woman warns against credit repair scams after falling into debt
Sienna Wheeler, a 24-year-old from Orange County, is warning others about the dangers of credit repair scams after falling into significant debt at a young age.
"This is ridiculous. Like, I am too young to have this much debt in my name," Wheeler said.
Three years ago, when Wheeler was 21, she had a few credit cards, one with a $1,600 limit.
"All of a sudden, in the mail, I get a letter one day, and it says, 'Hey, we've made a mistake, we're increasing your credit limit to $45,000.' And this is when I'm 21 years old," she said.
She got excited thinking about all the great things she was going to do with the money.
"I ended up maxing out the card plus two other cards. So, all in all, I was over $60,000 in debt at 23 years old," Wheeler said.
She made minimum payments of $1,800 a month for over a year, but that wasn't working. Wheeler did her homework and started looking at all her options.
"I can't say if they're all legitimate businesses or some of them are scams, but especially when you see those signs at intersections and things that appear to be scribbled with permanent marker, they're lead generators, they're looking for new customers," said Holly Salmons, the CEO of the Better Business Bureau of Central Florida.
Salmons said there are many different levels of help, including credit repair, debt consolidation, debt settlement and budgeting.
"While this won't be a fast fix, nothing in this space is going to happen quickly," Salmons said.
Finding the right credit repair service is key. Beware of scammers.
"You go to do your research first. Make sure you look for them in the Better Business Bureau, make sure you look for any reviews in the search engines. More importantly, if you have any personal friends or acquaintances that have used their services successfully, check with them before handing off any sensitive information," said Emanuel Rivero, the vice president of operations at Money Management International.
"What you're looking for is how long has the business been in business? What are other consumers saying, and if you don't feel equipped to do a full internet search yourself, your local Better Business Bureau, make a phone call, we have an office full of people who can help you," Salmons said.
Be wary of companies that ask for money upfront.
"We don't charge a fee for our, what we call our counseling session or review of your situation. If you join what's called a debt management plan, which is a debt consolidation of sorts, that helps reduce interest rates. There are monthly fees associated with that, and they vary by state," Rivero said.
A debt management plan is what Wheeler did through Money Management International.
"I've already paid off three cards," Wheeler said.
"And I'm sure they lowered your interest rate?" asked Gail Paschall-Brown, WESH 2 News reporter.
"Yes, I started at 30 percent interest rate on a $60,000 total debt, and they got me down to seven percent. It's made such a huge difference," Wheeler said.
Wheeler and experts said don't be embarrassed to reach out for debt help. Just make sure you do your research first and go with a legitimate company.
In January, the Federal Trade Commission announced it was refunding more than 7,600 victims of fraud, totaling $5 million.
The FTC filed a lawsuit in November 2022 against Acro Services, which operated under multiple names.
The government said Acro Services charged customers thousands of dollars in unlawful upfront enrollment fees and monthly fees.