Is it possible to sue the debt consolidation service that I hired?

I sympathize, and I wish I had good news for you, but I don’t—I believe that there is nothing you can do hear unless you prove the debt consolidation service lied about important facts, which lies convinced you to take out the loan and insurance. However, lying is not the same thing as simply not pointing out all the ramifications or consequences of what you’re doing.

Let’s start with something basic: personal debt consolidation is not the same as personal debt reduction. Consolidating your debt does not reduce what you owe. It does simplify your debt and it can lower your monthly payments; depending on how you do it, you might also be able to lower your interest rate.

However, the main way that monthly payments are lowered is by extending the number of payments—you pay less each month, but you pay for a longer time, which means that you pay more in total.

A debt consolidation service has no obligation to you other than to not commit fraud, or lie or deceive. If they did what they promised—they lowered your monthly payment—and they did not make any other enforceable promises or representations, such as promising that your debt would be reduced or that you’d pay less over the life of the debt, then the probably did nothing wrong. The fact that it worked out horribly for you does not automatically mean they did something wrong in a legal sense.

If you think they did lie in some fashion, however, I urge you to consult with an attorney, with whom you can share all the facts in confidence, who can review any and all agreements in detail, and who can advise you on whether you have a claim worth pursuing.

Good luck.