Debt Settlement Companies – How New FTC Laws Make Debt Settlement A Legitimate Option
Consumers who enter into a debt settlement program will no longer have to worry about paying thousands of dollars with no guarantee of actually settling their debts. With the new laws recently passed by the FTC, debt settlement companies will no longer be allowed to collect upfront fees until the debts are actually settled. These new laws shift the risk from the consumer to the debt relief agency and make debt settlement a much more legitimate option.
Since new bankruptcy laws were passed in 2005, the process of bankruptcy became much more difficult to qualify for. Debt settlement companies have thrived in this market by collecting upfront fees without having to actually perform.
Unfortunately this type of business model, collecting fees with no performance guarantee, led to many shady and unethical companies entering the market. These companies promised to settle the consumers debt for 50% of the balance but in reality they did nothing but collect their fees. With the new FTC laws recently passed, these shady debt relief services will be pushed out of the market.
The legitimate debt settlement services that actually had been settling consumers’ debts will survive. They will have enough confidence to collect on the back end because the debt settlement process does work when done efficiently and with the right company. The best companies have established relationships with all the major creditors and can provide significant leverage in the debt negotiation process. Website like FreeDebtReductionHelp.com can help consumers find the legitimate debt settlement companies and avoid the shady ones.
Debt settlement companies settled over $1 billion in unsecured debts in 2009 alone. This resulted in approximately $400 million being collected for creditors and $600 million being eliminated off the books for debt ridden consumers. Debt settlement negotiators are basically the middle men that try to find a common ground between the creditor and the debtor. Consumers are able to get rid of some of their unsecured debts while creditors are able to collect delinquent funds that they most likely would have never collected had it not been for the debt settlement process.
Debt settlement programs grew significantly over the past few years as a result of stricter bankruptcy laws. Consumers that want to avoid bankruptcy and eliminate unsecured debt see debt settlement as a viable option. Debt settlement companies that have implemented the attorney based model provide consumers much more protection under the law than those that have not. Therefore it is highly recommended that consumers considering debt settlement go through a company that is fully back by attorneys.
To locate legitimate debt settlement companies that will offer consumers the most protection under the law check out the following link:
Or Call: 877-853-6466
- Contact Information
- Michael Smith
- Debt Relief Associates
- Contact via E-mail
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