Be cautious when working to solve debt

(WPRI) -- Thousands of Americans are facing debt issues on a daily basis right now. We hear from so many of you who have signed up with debt management companies, only to end up deeper in debt. Knowing what you're getting into before signing up can mean the difference between being debt-free and going bankrupt.

"Back in 2008, I just got over my head in my credit cards," says Amy Breen from Woonsocket.

Desperate to be debt-free, she signed on with a law firm. And what the person on the other line promised was music to Amy's ears.

"Promises were that they were going to take over all my credit cards," says Amy. "I was to receive no calls from creditors."

Over the years, Amy's debt slowly began to go down. But then out of nowhere, Amy was sued.

"It started to get really odd when I was served by one of my credit cards to go to court," she says. "And I called the lawyer to say, ok, what do I do?"

What followed next for Amy is what the Attorney General has a problem with. The national company helping Amy manage her debt referred her to a local attorney to act as a coach, prepping her to go to court to represent herself. But Amy, like hundreds of other consumers, never actually met her attorney.

"I was very scared," she says. "I had never been to court before and he advised me that he would tell me what to say, but he couldn't come with me."

"It's not specific, it's generic," says Peter Kilmartin, Rhode Island's Attorney General of the process. "And they really don't have any attorney/client relationship with the person who is getting sued who has the debt."

It's a practice known as "ghost writing." And Kilmartin and other consumer advocates believe it shouldn't be allowed.

Consumer Attorney Chris Lefebvre asks, "Who is the local attorney representing? The consumer? Or are they trying to protect the interests of the company? And that's the big issue."

Right now there's been a superior court decision that says "ghost writing" should not be occurring in Rhode Island. The issue will head to the state's supreme court next.

For more information, check out the Federal Trade Commission's guide to dealing with debt.