Crackdown on debt relief
Many people are turning to companies debt relief because they are desperate. But in the end, are often thousands of dollars, and due more to its creditors.A couple of HistoryThat’s exactly what happened to Laura Sweet and her husband. We met last spring. Had accumulated tens of thousands of dollars in credit card debt, and that come into the school and had two children. The company promises of debt relief to cut its debt sounded appealing.“This will help us out and be able to get finances in order, a kind of new beginning,” Laura said.
So he enrolled in one. Each month they sent a thousand dollars in a special account, the money they thought would be used to pay off your debt. But after months of not listening, it checks the account and found the balance was zero.
“When I called to deal with that, he said was his share.”
N of the debt is settled yet and the money was gone.
“It probably took between 6 and 8 thousand dollars,” said Laura.ChangesThe Better Business Bureau has processed approximately 3,000 complaints this year against companies debt relief, and now the feds are taking action. Come Oct. 27, all companies in the for-profit debt relief will be prohibited from charging upfront fees for their services. No money until the consumer has or has reduced its debt or cutting interest rates to their creditors.
And from last week, companies now must disclose to consumers how long it take to see results, the amount of service costs and the negative consequences that might occur with the use of their services. In addition, companies may not represent the success rate for consumers.The changes are intended to protect people like candy, just looking to straighten out his financial mess.
“It’s frustrating and look back and say why I do this,” said Laura.Other optionsBefore seeking the help of a business debt relief, the BBB suggests trying to contact their lenders to yourself, or seek help from a credit counseling center nonprofit. If it does turn to a company in debt relief, be sure to Google the company to report complaints and check the BBB before signing up.
The BBB issued the following statement about the changes.BBB recommends that consumers understand the new rules of Debt Relief TelemarketingThe amendments to the Telemarketing Sales Rule Target Consumer ProtectionSouthfield, MI – The new amendments (FTC), the Federal Trade Commission’s Telemarketing Sales Rule (TSR) came into force on September 27, 2010 on the prohibition of debt relief companies from making false promises consumers. The new rules apply to the settlement of the debt to profit, debt consolidation and debt counseling companies, and will help to inform consumers of the services offered before payment.This year, BBB has processed about 3,000 claims across the country against companies debt relief, arguing that companies often charge large upfront, do not reduce your debts, or misrepresent their services. The FTC amended rules require companies to disclose information that is intended to help prevent such complaints. The following rules are the major additions to the FTC TSR September 27, 2010:• Companies of debt relief are required to disclose to consumers how long it take to see results, the amount of service costs and the negative consequences that might occur with the use of their services.• Companies may not misrepresent your success rate to consumers or falsely claim it is a nonprofit organization.• In addition to calls made to consumers by debt relief, calls made to companies in debt relief in response to advertising will also be covered by the Telemarketing Sales Rule.BBB also reminds consumers that, from October 27, 2010, all companies in the for-profit debt relief will be prohibited from charging upfront fees for their services. The FTC has created a guide for business debt relief to help meet the new regulations.Before seeking the help of a business debt relief, BBB recommends that consumers consider the following options:• Research the company to BBB – Find out how many complaints it received, how the company responded to complaints and if there is any government action or lawsuits against the company.• Contact your lender first – Try to reach an agreement directly with creditors before enlisting outside help. This can be done for free.• Seek help from a counseling center for nonprofit credit – credit counseling centers can provide guidance for little or no cost. Www.nfcc.org visit to the location of the nearest center.To check the reliability of the company and find a business trip www.easternmichiganbbb.org trust.About Better Business Bureau
The Better Business Bureau serving eastern Michigan is a nonprofit organization to help protect consumers and businesses against fraud and unethical practices in local businesses
market. In addition to its recognized dispute resolution services, the BBB maintains reliability reports on the service history of more than 80,000 customers of local businesses and provides consumer education materials on numerous topics. Your BBB offers its services free to the public and its service territory stretches across Eastern Michigan Tree Jackson / Ann through Detroit Metro, Lansing, Flint, upward to Alpena, and covers the entire Upper Peninsula of the state.
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