subject: New Debt Settlement Relief Laws - Making Settlement A Legitimate Option [print this page] New Debt Settlement Relief Laws - Making Settlement A Legitimate Option
The new debt settlement relief laws are in place and they have helped in protecting the consumer rights. The laws have made settlement a legitimate option. The question of legitimacy appeared when the demand for settlement increased. The increase in demand gave birth to many firms in the settlement industry which were fraud and their only intention was to make money and not helping the consumers. In order to do so, these firms actually came up with false promises and then when the consumers approached them, these firms asked for their service fee in advance on the ground that they will be needing this money to cover the costs of negotiation.
Being in trouble, the consumers wanted to get out of their debts as soon as possible and driven by this urge to lead a financially healthy life, the consumers paid this money to the firms. Once the firms received the money, they simply turned back and never helped the consumers. They did not make any attempts to negotiate with the creditors. When asked by the consumers after a few months, the firms reported that the negotiation failed and they can do nothing more to help the consumers.
Now, in order to help the consumers and in order to make settlement a legitimate option, the FTC has put a ban on up front fee collection and asked the firms to first settle consumer debts and then ask for service fee. This forced the fraud firms to leave the market, leaving behind only the legit firms. This way, the new debt settlement relief laws have made settlement a legit option.
Debt settlement is a viable option to filing bankruptcy and is becoming increasingly popular amongst Americans with over $10k in unsecured debt. Creditors are ready to negotiate. You can literally eliminate 50% of your unsecured debt with a settlement.
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