Debt Settlement Relief Act 2010 - How New Federal Laws Protect Consumers Seeking Debt Relief
The Debt Settlement Relief Act was recently passed and now consumers won't have to pay any fees to debt relief services until they reach a successful settlement deal and eliminate at least 35% of your unsecured debt.
Online, December 6, 2010 (Newswire.com) - The Debt Settlement Relief Act 2010 was recently passed by the Federal Trade Commission and now consumers seeking debt relief have much more protection under the law. Now consumers that enter debt settlement programs will not have to pay upfront fees. Simply put, if they don't settle your debt, you don't pay a dime. This goes a long way in improving the debt settlement process and making debt relief a real possibility for American consumers.
After new bankruptcy laws were passed in 2005, debt relief programs became very popular however many of them were not advantageous for the consumer. They had to pay upfront fees for services that were not guaranteed. Sure these debt settlement programs promised to eliminate around 50% of your unsecured debt but at the end of the day if they failed to do so, the consumer was simply out of luck.
As you can imagine this type of business model led to several shady services taking advantage of desperate consumers. They made a business out of collecting upfront fees. Many companies would simply sit back and collect fees and not even contact let alone negotiate a reduction in debt with the consumer's creditors. So, for the last 5 years entering into a debt relief program was a risky option. Well, not anymore thanks to new federal legislation.
On October 27th 2010, the Debt Settlement Relief Act was passed and now consumers won't have to pay any fees to debt relief services until they reach a successful settlement deal and eliminate at least 35% of your unsecured debt. This means that if you have $20,000 in unsecured debt, the settlement service must eliminate at least $7,000 of your balance in order to collect a fee. Considering these new laws, debt settlement programs have become a much more legitimate option for getting out of debt.
Debt settlement is seen as a legitimate alternative to filing bankruptcy. If you have over $10,000 in unsecured debt and are experiencing a financial hardship then a debt settlement can make financial sense. Check out the following link for a free consultation from a certified debt relief specialist in your area. They will go over all your options for free.
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