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DON'T BE HAMMERED BY YOUR DEBT

DON'T BE HAMMERED BY YOUR DEBT

Wednesday, September 08, 2010

Big Changes in Debt Relief Industry


The ADVANCE FEE BAN. There are huge changes coming to the debt relief industry! I’ll give you the legalese first. On July 29, 2010 the Federal Trade Commission announced its amendments to the Telemarketing Sales Rule (“TSR”) targeting the sale of “debt relief services” (the “Final Rule”). Under the Final Rule, virtually all debt relief service providers will be subject to a ban on advance fees before services are provided. The new rule will apply to these agencies because they now fall under the jurisdiction of the new Bureau of Consumer Financial Protection. The Final Rule is available now on the FTC’s website. The provisions of the Final Rule will take effect on September 27, 2010, with the exception of the advance fee ban provision, which will take effect on October 27, 2010. Importantly, the advance fee ban does not apply retroactively, so it does not apply to contracts with consumers entered into prior to October 27, 2010. The Final Rule contains specific requirements for debt relief providers related to charging an advance fee before providing any services. It specifies that fees for debt relief services may not be collected until:
· the debt relief service successfully renegotiates, settles, reduces, or otherwise changes the terms of at least one of the consumer’s debts;
· there is a written settlement agreement, debt management plan, or other agreement between the consumer and the creditor, and the consumer has agreed to it; and
· the consumer has made at least one payment to the creditor as a result of the agreement negotiated by the debt relief provider.
Previously, most of these scam artist institutions would charge you a huge up front fee for the privilege of their practically non-existent services and after they collected your money, they would do absolutely nothing. This wouldn’t be so amazingly infuriating if what they were charging you for you couldn’t do yourself. But at least now, they will have to actually contact one of your creditors and do what they advertise before they demand that you pay the thousands of dollars that you will be a fool for paying. So if you are foolish enough to use one of these outfits, at the very least, hold until October 27, 2010 to sign up!

10 comments:

Anonymous said...

A very needed law. I went to Credit Solutions of America and by the 8th month I was being sued. Most of the money I had been setting aside went to pay the credit negotiation company. Now after 3 years we still have 3 debts outstanding (12 originally). I paid the debt negotiators more than $5000 for very little help. I now know that I could have handled the negotiations my self and probably better because I would have had the money in the bank to do it.

Debt Collection agencies said...

thanks for sharing information related to the change in law of Debt collection, Debt collection or debt recovery has to be done with a professional approach, to maintain the good will between your client and yourself.
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Anonymous said...

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debt collectors said...

Yes, some people run up debts and fail to pay what they owe. Especially when they are using credit cards. However there are also debt collection agencies and debt collectors who perpetrate scams on honest people who owe nothing; and debt collectors who clearly violate the law in collecting debts and people should be very vigilant with their actions and tactics.

company debt advice said...

This is great information. Thank you for sharing!

andrew siddle said...

Neat & Clean Post


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Aleksi Kattilakoski said...

I really hate scam artist.Thanks for sharing this excellent information.Keep posting.

garage experts said...

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Thanks for your debt related news and debt collection information. I am sharing with my thoughts from which related peoples. thanks for your services.

anandan said...

Great !! Thanks for sharing this information about the change in law of debt collection.

Thanks