Federal Credit Card Debt Relief - How New Federal Laws Help Debt Settlement Programs

Federal Credit Card Debt Relief - How New Federal Laws Help Debt Settlement Programs

On October 27th, 2010, new federal credit card debt relief laws were passed that made debt settlement programs a much more legitimate option for consumers and small businesses. Debt settlement companies are no longer allowed to collect upfront fees for their services. This means that you don't have to pay them a single penny until they are able to negotiate a successful settlement deal and eliminate at least 35% of your unsecured debts.

Making the debt settlement industry a performance based services was a long time coming. When the new bankruptcy laws were passed in 2005, these debt relief companies thrived because it was more difficult to qualify for bankruptcy. While many consumers were able to successfully eliminate their unsecured debts with a settlement program, many more were ripped off. There was simply no accountability for these companies and many of them were only in business to collect upfront fees. They weren't really negotiating with your creditors, they were just sitting back and collecting fees. This is not possible anymore. They don't perform, they don't get paid. Simple as that.

The majority of bad companies have put put out of business due to this new federal credit card debt relief legislation. They know that they can't stay in business without upfront fees. The legitimate companies however will ultimately benefit from this legislation. The industry itself will have a better reputation and the good companies that have actually been helping consumers settle their debt will be better off because of it.

Getting out of debt through a debt settlement process is currently very popular but you need to know where to locate the best performing programs in order to get the best deals. To compare debt settlement companies it would be wise to visit a free debt relief network which will locate the best performing companies in your area for free.

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