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How New Bankruptcy Laws Make Debt Settlement The Only Option For Many Debt Ridden Consumers


The process of debt settlement has been around for nearly 10 years however it has never been so prevalent amongst our debt ridden society. New bankruptcy laws have made bankruptcy much more difficult for consumers to qualify for and therefore many of them have opted for debt settlement.

Debt settlement allows consumers to pay less money than they actually owe to their creditors. The consumer will pay into a monthly savings account until it builds to an agreeable amount that the creditor will likely accept. According to The Association Of Settlement Companies (TASC) the average debt settlement is negotiated for 50% of the original debt balance.

Opponents to debt settlement, including some members of congress, argue that most debt settlement companies charge excessive rates and large upfront fees for their services. While itís true that there are predatory debt settlement companies out there that take advantage of desperate consumers it also true that there are legitimate debt settlement companies that do not charge upfront fees and will be able to live up to their promises. Consumers need to know how to identify a legitimate debt settlement company and stay away from those predatory services. Websites like will be able to supply legitimate debt settlement companies for consumers.

For a consumer who is in at least $10k in unsecured debt and does not want to or canít file bankruptcy, debt settlement can be a viable debt relief tactic. It is important to make sure that the debt settlement company is an accredited member of TASC. TASC is the regulatory body of the debt settlement industry and any company that is not a member should be avoided at all cost. Also make sure that the debt settlement company is fully backed by attorneys. Twenty nine states have already required debt settlement negotiators to be lawyers and if a company has not yet implemented the attorney based model they should also be avoided. The debt settlement companies backed by attorneys will provide consumers the most protection against unlawful collection practices and potential lawsuits.

Debt settlement will have a negative impact on a consumers credit score and any debt settlement company that says otherwise is being untruthful. Getting a negative credit score is a tradeoff to be able to eliminate unsecured debt by 50% and consumers need to fully understand the risks associated with debt settlement before they opt in a program. Websites like will provide consumers and unbiased opinion on whether debt settlement makes financial sense for them.

Unfortunately it is a reality that there are more people currently in debt than ever before in history. Creditors understand that if a consumer declares bankruptcy they will likely receive nothing. Therefore major creditors are agreeing to more debt settlement deals to recover at least some of their money.

To locate legitimate debt relief companies that have a proven track record in negotiating consumer debt settlement deals check out the following link:



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