The new debt assistance act has made debt relief services more accessible to consumers today than ever before. Previously, many Americans simply threw up their hands in the face of debt and were not even aware that debt relief options existed. Today, more Americans are using debt assistance agencies and services than ever before. Many more Americans have been able to reduce their debts by using these services than ever before. In fact, more consumers are able to do so without filing bankruptcy than ever before.
Under the new legislation, debt assistance firms must also reveal the facts about how long their plan is going to take to solve a consumer’s debts, how much it is going to cost, and what can be done if the plan does not work. Additionally, consumers are now allowed to receive more accurate statements regarding their accounts. For example, one of the most prominent changes under the law was the elimination of the debt consolidation companies’ fees. Until this point, these companies had insisted that their fee of $50 per month was necessary in order to help their customers settle their unsecured debt. As a result, there was no way for consumers to know if they truly needed to use their services or if they could simply accept their fees and move on.
Thanks to this new regulation, debt assistance programs and debt consolidation companies are now required to let their clients know about all of their costs. This includes not only their monthly and annual fees, but also any additional charges that may apply at the end of their contract. In the past, many debt consolidation companies did not tell their clients about the additional fees that would kick into place once their account was closed. This led to consumers who were already maxing out their credit cards paying even more in interest because they did not realize that their accounts were already close to being maxed out. Now, debt assistance companies are required to give the client complete disclosure.
Another piece of information that is now required from debt assistance agencies is to inform clients about a process called credit repair. There have been questions over the years as to whether or not credit repair is a legitimate service, and the better business bureau is no longer taking a stance on the issue. They have decided to leave the matter up to the credit repair companies themselves to determine if they are going to charge their clients for it.
When you use the services of a debt assistance company, you will likely start by receiving a free consultation. This way, you can discuss your financial problems with a representative before making any decisions. The representative will look at your current finances to determine what your best options may be, and then they will work with your creditors to get your interest rates decreased and your balances lowered. They will also work with your creditors to lower the amount of debt that you owe in order to create better credit scores. Once you have paid off these debts, your credit score will begin to increase as long as you maintain good payments.
The most important thing to remember when you use debt assistance services is to read the fine print. If you are working with a debt consolidation companies, for example, you should be aware that the consolidation loan will be a permanent contract that will stay in place even after your initial six month term has ended. You will be required to make timely payments on this loan, but at the same time, you will be required to pay your monthly payment on time as well. It is important to understand all of the details that are in the fine print of this contract before signing.
When you work with debt assistance agencies, you can often get a better deal than you would when working with a credit repair agency. Credit repair agencies will be charged a fee every month in connection with getting your credit report, which means that you will more than likely end up paying more in the long run if you hire them. Debt consolidation loans, on the other hand, do not charge a fee and only require one payment per month – with a significantly lower interest rate. In the long run, it is usually much less expensive to work with a debt consolidation company than it is to work with a credit repair agency.
When you work with a debt assistance or debt management plan through an agency, you can avoid dealing with late fees and over the limit fees. These fees can really add up if you are unable to repay your debts on time, and an agency can offer you peace of mind because they will be contacting creditors for you in order to make sure that you repay what you owe. You can also benefit from the lower interest rate that comes with using a debt management plan, since it will save you money in the long run and it may even help you qualify for lower interest rates in the future.