Debt Settlement Act 2010 - How New Laws Effect The Debt Settlement Industry
Online, October 4, 2010 (Newswire.com) - Getting out of debt via a debt settlement process has just gotten easier thanks to new laws passed by the Federal Trade Commission. These new laws effectively ban debt settlement companies from collecting upfront fees from clients. Now consumers or small businesses that enter into a debt settlement program can be assured that they won't have to pay a dime until their debts actually settle.
These new laws make the debt settlement process much more legitimate and an overall better deal for clients. In the past, many consumers were paying upfront fees and had no assurance that their debts would actually settle. Debt relief companies would make promises they simply wouldn't fulfill and consumers were left with the bill. This is not possible any more.
Debt settlement programs do work when done by the right company in a legitimate manner. Credit card companies and other creditors of unsecured debt are very concerned about the rising rates of delinquent accounts. They know that if the consumers were to declare bankruptcy they would likely not collect any of their money back. With debt settlement, they are able to at least collect 50% of their money back which is better than nothing.
The advance fee ban is great news for consumers in debt. The debt settlement process will still survive but there will be much less risk on the consumer's behalf. The days of paying large upfront fees without getting any real debt relief service are over. These companies will only be able to get paid when they actually make a deal with the creditors and settle the debts.
Debt settlement is a legitimate alternative to bankruptcy but not all consumers will be eligible for it. In order to qualify the consumer must be at least $10k in unsecured debt and also be able to prove a legitimate financial hardship such as a loss of job or medical issue. There are Free Debt Relief Networks that help consumers locate TASC certified debt settlement companies as well as provide a free consultation to go over all available debt relief options.
If a consumer is going through a financial hardship and understands the risks associated with debt settlement, then it can be a viable way to eliminate unsecured debt and clearly is a better alternative to filing bankruptcy.
To locate legitimate debt settlement companies through a free debt relief network check out the following link:
