subject: Obama Debt Relief Plan - How the New FTC Laws Help You With Debt Relief [print this page] The great Obama debt relief plan is one of the best plans as it has helped people in solving their financial as well as social issues. Obama debt relief plan has played a major role in stabilizing the economy and due to this plan the dark grey clouds wandering over American are slowly clearing off. The downfall of American economy was led by debtor's inability to pay off their debts due to recession and things became worse when insolvency became the best method of solving all liability issues. To control all these issues; first insolvency laws were changed and new methods to solve liability problems were formulated.
Previously insolvency was being filed by every one; even those were filing insolvency that had the ability to pay of their debts. Every body was filing under chapter 7 due to which creditors had to face huge losses and many creditors even became bankrupt. Those creditors who had the power to lend; stopped lending at all and they did not even lend money to those who were having good credit scores. His affected the economic growth of American. To control the situation the government changed insolvency laws. According to these laws; a person earning higher than the minimum earning level of a state for more than six month with have to file under chapter 13. According to chapter 13 a debtor has to clear the debt amounts with the aid of relaxation in the package of the loan.
The above changed law helped in controlling and minimizing the number of people filing insolvency. During this period a new method was formulated; named as debt settlement. This method gained great popularity as according to this method any debtor owing more than 10,000 can gain relief by negotiation and getting the loan amount reduced. The debtor ended up paying a small part of the amount and he was relieved from all liability issues. Due to increase in popularity; fraud settlement firms opened up which polluted the market and due them debtors started refraining from settling their liability amount and they started using insolvency.
This situation was once again controlled with the aid of addition of a new law in the liability settlement industry. According to this new law; a settlement firm will not be eligible to charge any upfront fees. They will only be eligible to charge if they have provided the services promised by them.
Debt settlement is a legitimate alternative to bankruptcy and can make financial sense for consumers with over $10k in unsecured debt.
Obama Debt Relief Plan - How the New FTC Laws Help You With Debt Relief
