One of the most important drawbacks of a debt settlement program is that calls from creditors and collection companies will persist while the client is in the debt settlement program.Debt settlement happens when the clients stop paying their creditors directly. Most debt settlement companies suggest their clients to cease communication with creditors. However, collection companies and creditors keep calling and “harassing” debt settlement clients and often tell them how “bad” a debt settlement program is in order to keep collecting debts, and creditors usually don’t stop calling until they are paid, getting payments, or forced to stop calling by some legal mechanism.Let us understand FDCPA (Fair Debt Practices Collection Act), before we proceed further.The Fair Debt Collection Practices Act is an Act which creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors, and prescribes penalties and remedies for violations of the Act. Its purposes are to eliminate abusive practices in the collection of consumer debts, to promote fair debt collection and to provide consumers with an avenue for disputing and obtaining validation of debt information in order to ensure the information’s accuracy.FDCPA has certain guidelines for collections companies. The collection companies are […]

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In the United States, in order to lessen the hassle and problem related to debt collection, the legislature enacted the Fair Debt Collection Practices Act.
What is Fair Debt Collection Practices Act?

Fair Debt Collection Practices Act is a U.S statute added in 1978 to the Consumer Credit Protection Act. Its purpose is:
0 To eliminate abusive practices in the collection of consumer debts
0 To promote fair debt collection
0 To provide consumers with an avenue for disputing and obtaining validation of debt information in order to ensure the information0s accuracy
Who are covered by the Act?
The following are the individual covered by Fair Debt Collection Practices Act:
0 Third party debt collectors
0 Debt buyers
What are the prohibited acts under Fair Debt Collection Practices Act?
The Act prohibits certain deceptive and abusive acts when collecting debts including the following:
0 Hours for phone contact. Calls between 8:00 am 0 9:00 pm are prohibited.
0 Contact after being ask to stop. This refers to contacting costumer after the latter serve a notice that he refuses to pay the debts.
0 Causing the telephone to ring or engaging other person in telephone conversation repeatedly or continuously
0 Contacting consumers at their place of employment after having been advised in writing that this is not acceptable
0 Contacting consumer known to be represented by an […]

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Tip! Get Rid of Credit Cards Successful debt reduction is primarily dependent upon not increasing your current debt. Many debt management companies will be able to work out arrangements with your creditors for reduced payments and interest.

With the number of credit card offers that the average American home receives every year, and the fact that the average American is about $8000 in credit card debt, it is not difficult to see how quickly consumers can get deep into debt with credit cards. Although it’s not easy, there are some simple steps that can be taken to begin to decrease your credit card debt and to begin to gain control of your spending and finances once again.

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To begin, look at the latest statement for each of your credit cards and check the balances on them. Then check the interest rate you are being charged by each of these cards. Some creditors can charge up to 21% or more in interest annually. If you find that you are carrying a balance on one or more of these high interest rate cards, and you are only paying the minimum required payment each month, it may take you years to pay the balance off. Not only that, but when the iniital balance is finally paid off, you will actually have paid many times the initial charges when you consider all of the interest paid during this time.

Tip! Write them a letter and send it certified mail. Do not admit to the debt.

The next step you must take to avoid this scenerio is to consolidate your debt. If you are carrying a balance on a high interest rate card, begin looking for a card that offers a lower interest rate. If you are carrying balances on more than one card, look for a credit card that offers an introductory rate of 0% on balance transfers. Apply for one of these cards and transfer your existing balances to this new card. Now you have anywhere from 6-15 months (depending on the new card’s terms) to work on paying down your balance without worrying about added interest charges. However, be sure to ask about any transfer fees involved before opening one of these new credit card accounts.

Tip! You have realised that you are gradually sailing deeper into debt and you need to get back on track before you develop serious problems.

The final key is to stop all unnecessary spending and increase the payments to your credit cards as much as possible. Above all else, avoid paying only the minimum required monthly payment. This is the worst thing you can do. Continue to pay off as much as possible every month while reducing your spending as much as possible and you will find your debt beginning to decline until you are finally out of credit card debt entirely.

Karyn Kudrna is owner of the website http://www.credit-123.com which offers information on low interest credit cards

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