subject: Federal Debt Relief Help - How New Laws Encourage Creditors to Settle Your Debt For Less [print this page] Federal Debt Relief Help - How New Laws Encourage Creditors to Settle Your Debt For Less
Are you suffering under the burden of debt and want to lead a debt free life? If your answer is yes, then read this article to learn how the American government is introducing new laws and policies to aid you to fulfill your desire.
When Obama was elected the president of U.S. many banks and lending institutes were on the brink of bankruptcy. The government took this issue seriously and induced hundreds of millions of dollars in these banks and companies to salvage them. But only money was not enough some new policies and rules were badly needed to support economy friendly debt relief solutions.
New FTC (Federal Trade Commission) laws, by the new American government, have proved to be a great success in helping the people, clear their debts in a legal and ethical manner. The most effective and fruitful law by FTC which states that no company can charge the consumer upfront and the payments for the debt settlement fee should be paid as a percentage of the reduction in the debt, only after the settlement is made. This law has thrown the fraud companies out of the market which had caused suspicions in the minds of the debtors about debt settlement.
If a company tries to charge the debtor upfront, a fine of $16,000 can be imposed on it. According to the new laws maximum fee for these companies has also been set to 15 %. So these laws have made the debtor feel secure and debt relief methods other than bankruptcy are becoming more popular.
The increasing number of debtors opting for debt relief options creditors are also encouraged to settle to a lesser amount, though, this is not the only reason. New laws by the government also facilitate the creditors opting for debt relief options with Tax Breaks, so they can lower the settlement amount instead of paying it as tax.
Creditors are agreeing to lesser amounts of the outstanding dues as it is better to get something instead of getting nothing. Thanks to the government new laws for Debt Settlement, Debt Consolidation and other relief programs which ensure that the creditors get a handsome percentage of their outstanding dues and maintain their financial status.
Debt settlement is a legitimate alternative to filing bankruptcy. Consumers can expect to eliminate around 50% of their unsecured debt with the help of a legitimate settlement program.
