subject: FTC and Debt Settlement - What the Government has Done to Make Debt Settlement Safer for Consumers [print this page] You must be hearing a lot about FTC and debt settlement these days. This is because the Federal Trade Commission has come up with some significant reforms in respect to the mode of operation of the debt settlement companies. Till now, these companies had a field day charging upfront fees from the consumers in advance without even giving any guarantee that they would certainly make them free of debt. Also, such charges were non-refundable and could not be retrieved in case of failure. However, the new law endeavors to make settlement safer for consumers and they can hope to get their money's worth.
FTC and debt settlement have become intrinsically linked to each other thanks to this new development. The government has not done it without reason. It was the need of the hour. What happened with most consumers is that they would shell out a huge amount as fees to the settlement companies and yet not be sure whether they would at last become free or not. The settlement companies insisted on payment in advance but without the guarantee of success. This cannot be done any longer. A settlement company not only has to enlighten the consumer on the total fees but also the time that it might take to settle the deal. Also, there is no question of payment if it does not succeed in making the debtor free of dues. All these factors have made the prospect of settlement more lucrative and convenient for the consumers which were not the case earlier.
You must know that the market also consists of many dubious and scam settlement companies. At times, it becomes a tad difficult to separate the grain from the chaff. However, with the help of these rules, you can make sure you will not fall a victim to that. This is because a company will be fined if it violates any of the above mentioned rules. The fine is not a meager amount. It is as much as $16,000. This means those shady companies will no longer get the opportunity to dupe you in the name of settlement.
The settlement companies can also benefit from these reforms. Of late, many people shied away from taking refuge to these companies as they were wary of the shady companies. These companies had done much harm to the industry. However, this new law will obliterate those scam companies and once again make people enthusiastic towards settlement options.
Debt settlement is a legitimate alternative to bankruptcy.
FTC and Debt Settlement - What the Government has Done to Make Debt Settlement Safer for Consumers
