subject: Debt Relief Frauds - How New Laws Make Sure Debt Settlement Companies Stay Honest [print this page] Debt settlement has been a subject of much controversy in the latest years. There were a lot of fake companies that were taking advantage of people and most of them were destroying the reputation of legitimate companies that were actually helping those in need. The worst thing was the upfront fee which was a way to make people pay and don't receive anything. Companies asked for a big upfront fee promising their clients that they will make sure they get a big reduction, but that didn't happen because the companies ran away with the money. There was nothing they could do because the companies were already gone when they realize that their money was stolen.
Recently the Federal Tax Commission adopted a great law that banned any companies from asking an upfront fee. This is very useful especially because it manages to keep people from getting abused by these companies. The companies cannot ask for any fee until they resolve their client's issues. The amazing thing is that they can get their fee from the amount of money they reduce so the costumer pays the creditor what they are supposed to pay as installment after the process and a part of that money goes to the debt settlement company. The reductions people can obtain are really big and because now there is no risk of hiring a fake company they can make sure that they hire an experienced one. The good news is that probably all the companies that are now on the market are experienced old companies that weren't affected by the new law. You can make sure that you obtain reductions if you tell your creditor in time about the decision you are going to make. Also, make sure that you have more than ten thousand dollars of unsecured debt.
Fortunately, more and more people are choosing debt settlement as a way to reduce their debt and all of them are happy about their decision. The new law has increased the trust people have and will have in debt settlement companies and less people are choosing other debt relief methods, especially bankruptcy which is so harmful for our system.
Debt settlement is a viable alternative to filing bankruptcy. Most consumers are able to eliminate at least 60% of their unsecured debt while avoiding many of the negative consequences with filing bankruptcy. If you are over $10k in unsecured debt you will be eligible for debt settlement.
Debt Relief Frauds - How New Laws Make Sure Debt Settlement Companies Stay Honest
