Debt Settlement - Debt Settlement Companies and Illegal Practices

Debt Settlement Companies Continue to be Fined for Illegal Practices

SCOTTSDALE, AZ--(Marketwire - March 14, 2011) - In a press release early this month, the Washington State Attorney General announced it had worked out a deal with a California based debt settlement firm paying restitution of $800,000 to 570 Washington state residents.

"Ever since the Federal Trade Commission (FTC) shut down debt consolidation giant Ameridebt in 2003, it seems you can't go longer than a couple of months to see this kind of headline", said Kristy Welsh, founder of Creditinfocenter.com. "Consumers need to be extremely cautious when choosing a debt settlement firm", Welsh advises, "there are still many unethical ones out there."

No matter how desperate you are to get out of crippling debt loads, it pays to research the company and study the contract before signing it. New rules put into place by the FTC September 2010 spell out what to look for:

Fees and refund policies must be disclosed upfront.
The time to get through the program must be clearly spelled out.
Firms must accurately estimate how much money a client must save up through the program to fully settle debts.
The negative effect on a consumer's credit must be clearly spelled out.
The company should be NFCC.org accredited.

Of course, the best way to get out of debt and avoid costly fees is handle things on your own. Creditinfocenter.com has complete free information on their website on negotiating a debt settlement with both credit card companies and collection agencies for a win-win situation. Welsh reports many of her readers have had great success using the information on the website.

Tips include getting a credit card company lower balances and interest rates if you are really struggling. For those whose debts have gone into collections, with a little self-discipline, consumers can save up money on their own and make a settlement with a collection agency, just as a debt consolidation company would.

About CreditInfoCenter.com:

Founded in 1997, CreditInfocenter.com is a free one-stop destination for consumers looking for free advice on repairing and rebuilding bad credit. It advocates the self-help approach to credit and debt management. Kristy Welsh is the author of several books on personal finance, including "Good Credit Is Sexy", a tongue-in-cheek guide to managing your credit.

For More Information on CreditInfoCenter.com:
http://www.creditinfocenter.com/

Good Credit Is Sexy:
http://www.goodcreditissexy.com