The number of corporations supplying debt settlement or debt consolidation reduction loans has been exploding. In order to crack down on fraudulent practices, the govt has enacted stiffer regulation on debt consolidation companies. Consumers have to look after what company they are giving instant money to. Those companies might be all for naught.
Debt settlement fraudulence for FTC to crack down on
Many companies began showing up supplying fast debt relief and debt consolidation loans right when the Great Economic downturn began. Customers were required to give an upfront fee and then make monthly payments. This would make all the debts go away for them. A lot of these businesses turned out to be taking a cash loan for services which were never rendered. After lots of complaints to the Federal Trade Commission, new rules were imposed in late Oct. Since then, there has nevertheless been abuse like this taking place. This has led to suits staying filed by the attorneys generals in many states. The Financial Times accounts that a promise of debt settlement for money currently is a scam that happens often to people. The "company" won't ever settle after taking the cash.
Being careful with debt settlement packages
If something seems too good to be true, it generally is. If you plan on consolidating debt through an agency, you will find things to be cautious of. You need to watch out for these things. If a business asks for an upfront fee for debt consolidation reduction, it’s probably a scam. There are plenty of non-profits out there that help people with debt management. With a potential debt settlement company, make certain you check them out with the National Association of Financial Advisors. The Better Company Bureau is another place to check.
What else to do
If you are trying to get rid of debt like personal loans, installment loans, or credit cards, you will find always things that can be carried out. You may need to change your budget a bit. It also helps to get payday loans each so often.
Citations
FT
ft.com/cms/s/0/8b73b788-f5c6-11df-99d6-00144feab49a.html#axzz16857y44E
NAPFA
napfa.org/tips_tools/index.asp
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