NATIONAL FOUNDATION FOR CREDIT COUNSELING SUPPORTS INVESTIGATION INTO DEBT SETTLEMENT INDUSTRY Financial Counseling and Education Leader Commends Attorney General Cuomo’s Effort Silver Spring, MD – The National Foundation for Credit Counseling (NFCC) applauds New York Attorney General Cuomo’s decision to Investigate the Debt Settlement industry, Which Is Taking Advantage of viable financially-troubled Its Own Consumers to fill coffers. Recognized as the leader in Financial literacy and education, the NFCC has-been active in warning Consumers of the Risks presented by an unscrupulous Debt Settlement Company (DSC). “At a time when to Many Consumers Are Serious Financial under pressure and looking for magic solutions, Many Debt Settlement Companies Have Responded shamelessly with the false promise of quick and easy answers, “Said Susan C. Keating, president and CEO of the NFCC. “More Often than not, the only beneficiaries of Debt Settlement Who Are the Providers Themselves Their line pockets by charging high fees and up-front payment Collecting Providing Before and Stock service to the consumer, “Keating added. “In the end, Who MOST Consumers turn to Debt Settlement FIRMS for help wind up Worse off than before – with Debts Higher Than and when to lower credit scores They Asked for help first. ” Working with a Debt Settlement company Mean That Tends to pay exorbitant fees with Consumers Disclosures limited; see Their Debts Increase in size As They amass more and beats Interest Charges; Are subject to legal collection Efforts, Including Litigation, Judgments and garnishment of Wages, see Weakened Their credit, and, at the end of the process, Receive a bill from the IRS for tax liability on MOST of the Debt Reduction Actually the settlement company secure. At the NFCC, we see the damage “after the fact-, as Consumers turn to non-profit agencies When the Debt Settlement Company Fails. Before It Can Be a consumptions made ??months That What They Thought Was a responsible effort “to address Their Debts have left him off Worse Than When He Turned to a first Debt Settlement Company

J. Thomas Rosch, FTC Commissioner recently said he was “concerned about certain practices that we have seen among some members of the industry.” FTC said it had sued seven companies debt settlement so far and that “In all these cases the defendants allegedly made ??false or unsubstantiated claims about the benefits of the programs, specifically that their programs will allow consumers to cancel all unsecured debt for a small fee, consumers would be debt free in 18-30 months, and that calls from creditors will cease. These statements are particularly striking in cases where the defendants contacted few consumer creditors, if they did. ” He then proceeded to offer suggestions to improve the industry of debt settlement:

• The debt settlement firms should limit their statements about the performance that may prove adequate.
• Ads should not give a false impression of the benefits of debt settlement.
• The ads should reveal the negative impact that participation in a program might have on a consumer’s credit rating.
• It should not be allowed to sign debt settlement charge payment before providing services.
• If you are considering debt settlement has to investigate. Insist that you are to disclose all charges, all tax implications, all possible legal actions and the impact on your credit report.

What You Should Know About Debt Settlement Companies

Each day seems to bring more bad news, layoffs, foreclosures, bankruptcy of enterprises. More families of our own communities are having trouble making ends meet. Unfortunately this makes people vulnerable to opportunists who promise quick fixes.

Be wary of ads that sound too good to be true. They claim that will reduce your debts by up to 70%, you will be completely debt free in just 12 months or that can free you of debt in months instead of years. Maybe they can in some cases. But consumers should know that most of these debt settlement companies are unregulated and charge high fees, most of them in advance, regardless if the consumer does not pay any debt.

During a workshop on Federal Trade Commission (FTC), which is investigating the settlement of debts, Travis Plunkett of Consumer Federation of America called the industry of debt settlement “a very troubled industry that often can not accomplish what promises. ” Some banks argue that debt settlement companies can not negotiate better than a consumer could negotiate on their own.

If you stop paying your creditors, while saving for a debt settlement could continue to grow if your creditors continue to earn interest and fees. And what is worse, your creditors may take legal action against you. It is not uncommon for charges for debt settlement add thousands of dollars in total. And if a debt is settled really probably will owe the Internal Revenue Service income tax on the amount forgiven.

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You can go through the ratings for online debt consolidation loan companies by the Better Business Bureau or BBB.
This organization based on the company evaluates complaints against itself or against the compliments she received. So can a sedge, a company it is as trustworthy by checking the credentials of the BBB on the Internet.

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When you create a profile of the debt you will end up reviewing several copies of your credit report. This is because not all debts are reported to each credit bureau. Reviewing several reports of major offices, the company can determine what you should and that you are behind. Also, review your credit report will help ensure that there have been attempts at identity theft: it seeks to appear as strange reports or accounts on your credit report.

In the end, a full service of debt consolidation can help you find the best loan at best interest rate. They can teach you how to correctly apply the loan to pay your existing debt. Can anyone teach how to control debt to individual or class instruction or they may be able to suggest where classes can be taken. If you feel that your getting your debt under control and you are looking to improve their financial situation, debt consolidation may be something to be dealt with appropriately.