Debt Settlement Companies Defend Themselves Against Congress - Is Debt Settlement A Legitimate Industry?
Online, April 28, 2010 (Newswire.com) - Recently leaders from the debt settlement industry appeared before congressional hearings to defend themselves against increased scrutiny. When the new bankruptcy laws were passed in 2005, debt settlement programs significantly grew and provided consumers an alternative to filing bankruptcy. Unfortunately, the rapid growth in the debt settlement industry led to some unethical companies entering the market that took advantage of debt ridden consumers. The Association Of Settlement Companies (TASC), the debt settlement industry's regulatory body, acknowledges that some unethical companies do exist however the industry as a whole is a legitimate industry that helps both the creditor and the consumer.
Debt settlement, or debt negotiation, is intended for debt ridden consumers that are struggling to meet their monthly financial obligations. It is a program designed for consumers who can prove a financial hardship and have at least $10k in unsecured debt. Debt settlement is basically the last stop before filing bankruptcy. Many consumers that do not want to file bankruptcy and are struggling to pay their monthly bills see debt settlement as a legitimate debt relief option.
The debt settlement industry settled over $1 billion in unsecured consumer debt in 2009 alone so it would be difficult to argue that the industry is not effective. Most consumer complaints about debt settlement center around the large upfront fees that some companies charge even though there is no guarantee of the debt being settled. Consumers should know that there are plenty of legitimate debt settlement companies that do not charge large upfront fees and will actually be able to live up to their promises.
The best way for consumers to ensure they locate a legitimate debt settlement company is to go through a debt relief network. A debt relief network will qualify debt settlement companies based on both performance and ethical standards. They will make sure the debt settlement company is TASC certified that they have a proven record in setting consumer debts. Going through a debt relief network is the best way for consumers to find legitimate debt settlement companies .
A consumer who cannot meet their monthly payments on unsecured debt and does not want to file bankruptcy would be a prime candidate for debt settlement . While the consumer's credit score will be negatively impacted it will not be near as bad as bankruptcy. As long as the consumer understands the risks, debt settlement can be a viable option to eliminate unsecured debt by 40-60% while avoiding bankruptcy.
To locate legitimate debt settlement companies through a top debt relief network check out the following link:
Related Media
