Debt Settlement Laws – New FTC Laws and Its Role in Legalizing Debt Settlement Firms

The recent debt settlement laws passed by the FTC or Federal Trade Commission indeed proved to be successful

. Profit debt firms are no longer allowed to collect upfront fees without taking care of the present dues. The current debt settlement reforms have several suggestions and recommendations that every individual may take advantage easily. These new laws are expected to have far reaching effects on the settlement industry and the bad image that relates to it because many of the shady and fraud companies are to be wiped out. The laws are expected to put into effect starting the 27th of October this year.

Debt settlement can help wipe out around fifty to seventy percent of the total consumer debt but the problem before arose from debt settlement firms which failed to fulfill its responsibilities and promises. There were plenty of fraudulent companies which charged their clients with upfront fees even before the entire process of debt settlement started. The irony about this practice is that consumers never knew whether their debt will be reduced to 70% or not at all. These companies took advantage of the situation by charging pricey transaction fees from customers and ending up telling their clients that their negotiation failed. The fees were non refundable and individuals are now even burdened for losing the cash they just paid.

The new debt settlement laws have already put a ban on the imposition of upfront fees from consumers. Now, these firms are only allowed to charge their clients after they have successfully eliminated the debt by the agreed percentage. This new regulation passed by the FTC will definitely help the industry get away from the clutches of fraudulent companies and will feature an added security to consumers who are having trouble with their unsecured loans.

Debt settlement firms are now great alternatives to filing bankruptcies. Call a debt settlement specialist now and take that step into experiencing a debt free lifestyle!

Debt Settlement Laws New FTC Laws and Its Role in Legalizing Debt Settlement Firms

By: Blair Alfred

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