As a result, bankruptcy filings increased to an extreme level. The Federal Trade Commission has to take severe notice of this alarming condition and thus it made new credit card settlement Act. This new Act is devised in order to provide relief to both creditors and debtors.
According to Credit card settlement Act, no companies can take any upfront fees from its customers until and unless it provides a deal to its clients. This will improve the efficiency of these companies and will filter out many illegal agents. At the same time, filing bankruptcy is made more difficult. Its fees have been increased and paper work is made lengthy. The Government wants to encourage people to settle their debts instead of filing bankruptcies. For getting an offer, a person has to negotiate with his creditors. He can directly negotiate with them or he can take help of a professional lawyer for this purpose.
Getting professional help is always recommended because it will increase your chances of getting a good offer from the credit card company. With the passage of time, debt keeps on increasing because of high interest rate. So, they should be settled as quickly as possible. Through this process, a person can get 50% elimination in the dues.
Although credit card settlement Act is a legal document yet it is understandable. A person who wants to know more about this law he can get a soft copy of this Act from the official website of Federal Trade Commission. Due to debt settlement, credit scores will be affected to some extent. A person who gets a chance to settle his debts should avail this opportunity because credit scores can be improved afterwards. A bankruptcy threat can be used as a wild card. When a lawyer states that his client is going to file for bankruptcy if creditors do not eliminate his debts then reduction can be achieved easily.
If you have over $10,000 in unsecured debt it may be a wise financial decision to consider a debt settlement. Due to the recession and overwhelming amount of people in debt, creditors are having no choice but to agree to debt settlement deals.