subject: Consumer Debt Relief Protection Act - How New Laws Can Help You Eliminate Debt Easier [print this page] Consumer Debt Relief Protection Act - How New Laws Can Help You Eliminate Debt Easier
Consumer debt relief protection act came as a blessing for the consumers. Because of the recession, the consumers suffered a lot. They lost their jobs and found that they failed to repay their debts to the creditors. The consumers were left with no other option expect for bankruptcy filing. They filed for bankruptcy even after knowing that they will face immense financial troubles in the future. Because of the sudden increase in the number of bankruptcy filing, the Federal government modified the bankruptcy laws and also brought new laws which made bankruptcy filing quite difficult. The consumers then shifted to debt settlement but again there was a problem.
With the path of bankruptcy being blocked, the demand for debt settlement increased steeply and this gave an opportunity to the fraudulent firms to make money out of the situation by cheating the consumers. They made false and fake promises and attracted the consumers and when the consumers were trapped, they took advance payments from the consumers and never helped them. This way the consumers lost faith in debt settlement industry and did not even trust the legit settlement firms. The consumer debt relief protection act came to rescue the consumers. According to this act, the credit card companies are not allowed to increase the interest rate without intimating the consumers well in advance so the consumers get a chance to make necessary adjustments to their budgets. Also the credit card companies will not be allowed to make any changes to the terms and conditions especially those related to interest charges before the consumer uses the card for one year. This definitely reduced the debt burden by a fraction.
Again as far as the settlement industry is concerned, the FTC announced that the firms will no longer be allowed to ask for advance fees from the consumers. They can only ask for a fee after they have actually settled the debts of the consumers and only after the consumers get back their financial stability. The consumers have the right to report to the FTC if a firm asks for advance fee. With these laws, the consumers are now able to trust the settlement firms and they can get out of their credit card debts easily! So, if you are a consumer in debt deciding for a debt settlement, look for any changes in the interest rates applied to your card without notification and also see if the settlement firms are asking for advance fees or not. If so, report it to the authorities and save yourself from unnecessary troubles.
With the new FTC laws recently passed, debt settlement is a legitimate alternative to filing bankruptcy. Creditors are ready to negotiate and now you won't have to pay a fee unless your debts actually settle.
