Thinking about either joining a credit card debt relief program or filing for bankruptcy? Are the legal implications of your actions causing you some degree of concern? After all, possessing a debt problem is bad enough without having to think about lawsuits over missed credit card repayments. Thankfully, recent changes in credit card debt law legislation provide some measure of protection for all participants of credit card debt settlement programs.
Court cases over our unpaid debts and the possibility of enforced payments, even repossession of possessions, are likely if you manage the debt reduction process badly. While bankruptcy has its own inbuilt protection, because it is handled by the courts, until recently credit debt settlement has been a complex situation.
New Modifications to the Credit Card Debt Law
Last Year the Federal Trade Commission (FTC) crafted significant adjustments to the laws, which opposes the sometimes underhanded techniques of a number of debt settlement organizations. As a result of economic downturn in the global economic system in the past decade, a large volume of consumers have sent applications for credit card debt settlement. Although many debt relief firms have dealt with these cases in an ethical fashion, quite a few providers have been billing abnormal advance service fees and monthly servicing fees while supplying the credit card debtor with either weak debt settlements or simply no debt settlement at all.
In quick overview it simply declares the following:
– The borrower will pay into a specific bank account which is held and handled by the person in debt. The person in debt can take out the account balance at any stage. As a result, the debt settlement provider has no charge of the debtor’s financial situation.
– The debt relief business has to supply considerable reductions (at least adjustments in the volume of debt in one or more of their client’s credit cards before billing the client for their solutions).
– The debt relief company can only charge their client a fee after the debtor makes at least one payment to the credit card company, which the debt relief company has settled the debt with on behalf of the debtor.
– The business can only impose a fee which is in proportion to the quantity of debt cost savings which they have settled on behalf of the debtor.
Financial debt problems are lousy enough without needing to encounter court cases, and yet for numerous credit card debtors this is exactly what they must deal with on a daily basis. When you are in this position, exactlty what can you do next? If your financial obligations are getting badly out of hand, you will be thinking about the debt relief path and contrasting it against personal bankruptcy.
These newly released alterations to the credit card debt law show that if you join a program, your hard earned cash is going to be safeguarded during the whole procedure and that this company can only get their payment once you have acquired considerable savings on your outstanding debt.
I am a blogger who writes articles on a number of Debt related topics including Debt reduction tips and Credit Card Tips. I operate a Debt Reduction blog and Debt Consolidation forum in the hope that it helps provide useful information to other people who need insurance. The latest article on the blog: Credit Card Debt Law Changes