subject: Credit Card Debt Relief Programs - Don't Pay A Penny Unless Your Debt Actually Settles [print this page] Credit Card Debt Relief Programs - Don't Pay A Penny Unless Your Debt Actually Settles
Credit card debt relief programs gained popularity after new restrictions were laid down on bankruptcy filing. The recession forced the consumers to file for bankruptcy and the massive increase in the bankruptcy filings created immense problem for the creditors and the whole economy. The new laws of bankruptcy stopped the pace of the bankruptcy and a new era of debt settlement was adopted. The consumers shifted their focus on debt settlement instead of bankruptcy and hence the demand for settlement increased manifolds.
The sudden burst of demand for the settlement option saw a boom in the settlement industry. Many new settlement relief firms sprang up overnight and they started attracting the consumers with new promises. The promises were attractive enough to grab the attention of the the consumers in debt. These new companies promised that they will help the consumers to get out of debt within a few months time and there will be no more financial problems for the consumers.
The troubled consumers trusted these companies and once they stepped into the trap, these shady and fake companies demanded for their fees in advance. When crossed by the consumers, these companies showed the logic that this money will be used in paper works and other expenses which are related to the settlement process and that this is the rule of the settlement industry. Well, one truth that they said was that advance fee payment was a policy of the settlement industry.
The consumers had no choice and they paid the demanded fee in advance. Once these companies received the money, they turned their back on the consumers and after a few months time reported that the creditor was not ready for settlement and that there is nothing more that can be done to help the consumers. The FTC wanted to stop this and hence made it a law that the relief companies will now have to settle the debts of the consumers first and if they fail they will not get the fee that they deserve. This kicked out the shady companies from the industry and it became much safer for the consumers. Now since it is a law to pay after receiving the services, you as a consumer have the right not to pay a single penny before the debt is settled. So, if a company asks for advance payment of the fees, know that the company is not a legit one and you have the option of reporting the same to the FTC.
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.
