Victory State Bank Repeats FTC’s Warning of Credit Card Interest-Rate Reduction Scams
STATEN ISLAND, N.Y. – Many consumers and businesses are attempting to dig out of a tough economy by seeking to lower their debts. Victory State Bank is urging you proceed cautiously and beware of questionable third-party promises to reduce the interest rates on your credit cards.
Voice mail boxes across the nation are being clogged with prerecorded phone calls from companies that claim to be able to negotiate significantly lower interest rates with your credit card issuers if you just pay them a fee first.
The Federal Trade Commission (FTC), the nation's consumer protection agency, says consumers who get these interest rate reduction robocalls should listen to them with extreme skepticism, and delete them. Many are scams.
The companies behind the sales pitches claim to have special relationships with credit card issuers.
They guarantee that the reduced rates they offer will save you thousands of dollars in interest and finance charges, and will allow you to pay off your credit card debt three to five times faster.
They claim that the lower interest rates are available for a limited time and that you need to act now. Some even use money-back guarantees as further enticement.
YOU CAN DO IT YOURSELF
The FTC says that the companies behind these robocalls can't do anything for you that you can't do for yourself — for free.
You have just as much clout with your credit card issuer as these companies, and you are just as likely to get turned down for a rate reduction regardless of their promises or supposed efforts to negotiate on your behalf.
Indeed, FTC investigators found that people who pay for these services don't get the touted interest rate reductions, don't save the promised amounts, don't pay off their credit card debt three to five times faster, and struggle to get refunds.
Amendments to the FTC's Telemarketing Sales Rule prohibit companies that sell relief services like these rate reduction scams on the phone from charging a fee before they settle or reduce your debt.
If you do business with a debt relief company, you may be required to put money in a dedicated bank account, which will be administered by an independent third party.
The account administrator may charge you a reasonable fee, and is responsible for transferring funds from your account to pay your creditors and the debt settlement company when settlements occur.
For additional information on “Settling Your Credit Card Debts,” visit the FTC at http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre02.shtm
About Victory State Bank:
VSB Bancorp, Inc. (NASDAQ: VSBN) is the one-bank holding company for Victory State Bank. As Staten Island, N.Y.’s only community-based commercial bank, Victory State Bank operates five full-service locations on the Island: The main office in the community of Great Kills, and branches in the communities of West Brighton, St. George, Dongan Hills and Rosebank. For additional information, Victory State Bank may be reached at 718-979-1100 or visited online http://www.victorystatebank.com .