For getting a settlement offer, a person has to negotiate with his creditors. He has two ways of doing this. He can either negotiate directly or he can take help of some professional lawyer. Direct negotiation is not prohibited in any law.
The Federal Trade Commission has made new laws in order to provide relief to both creditors and debtors. In the past, settlement companies provided very poor quality services to their clients. Due to this degradation, many people started filing bankruptcy petitions.
Actually there is no magic involved with bankruptcy itself, these are stats that change trends and cause profit and loss. According to stats provided by U.S court, in 2009, almost 1,412,870 cases of non-bankruptcies were filed. In 2010, this number increased by 14% of its previous year value.
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.
Actually, creditors increased their interest rates but it could help them in recovering their money. So now some companies have started slashing their interest rates. According to the new Act, settlement companies have to make a deal with their client’s creditors and then they can charge their fees. Upfront fees are totally banned. In the past, many illegal companies started scam business.
They charged thousands of dollars from their clients and then did nothing. This new law will throw out all these illegal agents. They cannot take huge fees. There is certain portion of the total settled amount that is paid.
For this reason, it is better to let your lawyer handle the situation. He will be paid for providing his services so let him do his job. They don’t use this wild card until and unless the situation is really worse.
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.
Hi readers my name is Harris Smith, thanks for reading this article I hope I will be useful to find home equity line of credit
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