What Practices Are Off Limits For Debt Collectors
A debt collector may not:
- Contact you at inconvenient times, for example, before 8 AM or after 9 PM, unless you agree to it.
- Communicate with you at work if you tell the debt collector your employer disapproves.
- Contact you after you send a letter to the collector telling them to stop, except to notify you if the creditor or collector plans to take a specific action.
- Communicate with your friends, relatives, employer, or others except to find out where you live or work.
- Harass you with repeated phone calls, profane language, or threats to harm you.
- Make any false claim or statement that you will be arrested.
- Threaten to have money deducted from your paycheck or to sue you, unless the collection agency or creditor intends to do so and it is legal.
Payday Loan Debt Relief
If youre in trouble with payday loans, then debt settlement is usually the best option. These debts carry rates of 300% or higher. Finance charges stack up quickly. You want to get out of debt for a percentage of what they say you owe.
That being said, if you have a few payday loans but most of your debt problems come from credit cards, you can include payday loans in a debt management program. This will consolidate the payday loans with your other unsecured debts. As a result, you can stop all those Direct Debit transfers that are draining your accounts and causing added fees.
On the other hand, if the bulk of your issues are with payday loans, use a debt settlement program.
Government Grants To Pay Off Personal Debt
When a low-income person has many expenditures but he is not capable to handle all the expenditures in his low income, he thinks about lending some money. But lending the money is means that they have to return the money and with the interest, which is not possible for them. And in the end, they look for grants from the government. If there is any grant that can help them financially to pay off debt. But people also doubt in their mind about those government grants that they need to pay back these debt relief grants by the government?
So, we tell you, that like the other loans or debts, you do not need to pay back the grant amount to the government. Because the government does not expect to take it back from you, they just want to help you in your tough time. So, it is a powerful tool for people who are facing life difficulties which are related to finance. They can use this financial grant from the government without any worry of payback and fulfill their financial needs.
In this article, you will get information about the various personal loans for the people which are offered by the government. The most interesting thing that the individuals do not need to pay it back. So, continue with the article and get information about various personal loans which are helpful for you.
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Managing Debt Collectors And Scammers
The most helpful government debt relief programs cant immediately fix your credit issues, especially if your finances put you in the lower end of the low-income household category.
Even your best intentions to pay off debt probably wont spare you from debt collection, and the scammers it attracts.
You should know your rights with debt collectors and even more importantly you should be on high alert to avoid debt settlement and debt elimination scams.
You may not instantly know them when you see them. But there are indicators when a debt relief service is offering you something it cant deliver:
Debt Settlement As An Alternative To Bankruptcy
Government Programs for Debt Relief
Filing for Chapter 7 or Chapter 13 Bankruptcy can plague you with a set of challenges, such as lawsuits, monetary judgments, or garnished wages which you may want to avoid, not to mention the long term impact on your credit score which it may incur. If you want to avoid bankruptcy, debt settlement is a viable and recommended alternative by the Federal Trade Commission. Under debt settlement, a debtor can receive a lump sum agreement or installment through which he or she will pay off debt at a reduced, fractional rate of the total account balance, perhaps at around half, or more or less depending on the debtors situation. Though debtors can hire a firm to help with creating a debt settlement plan, the FTC warns against for-profit firms as they are often out to scam debtors. Debtors can create their own self-managed debt settlement plan or look into free credit counseling agencies.
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Low Income Financial Assistance Programs For Debt Relief
Many times, when we are going through difficulties in our life, we just want to get help anyhow and we dont think that the help which is given to us is useful or not for us, or it can be a scam. Same as, many times most of the non-profit organizations come forward to help the people and also people think that getting help is the best source, instead of the government. But when you decide to take help from a non-profit organization then you need to read the small print. Because most of the time these non-profit organizations come with schemes that are not helping the people, but they do scam with them and people have to face more difficulties. Thats why it is most important to know about their schemes and investigate them in advance, so later you dont have to face any problem.
When you are seeking government grants to get out of debt, you will find a list of the government grants That are provided by them, and the amount will lie between $5 to $80 anywhere. But you find that in the end, all these grants are the same, and just are sold by different companies. So, first confirm which grant you need and which company is provided it to you, so that you cannot apply for the same grant with any other company.
How To Request Help From Your Credit Card Companies If Youve Been Impacted By The Coronavirus Pandemic
Missing a payment on your credit card or paying it late can result in fees or added interest, but it can also have a negative impact on your credit score. This is why its important to contact your credit card companies immediately if you know you cant pay your bill.
Here are important steps to requesting relief.
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Health And Human Service Funding
The plan provides a scheme that will allow as many as 3.64 million uninsured people apply for health care tax credits. As many as 1.77 million will qualify for $0 marketplace coverage. ARPA spends $120 billion on vaccines, supplies, and disaster recovery, and another $20 billion on community health centers, public health workers, and mental health and substance abuse programs.
National Debt Relief Vs Freedom Debt Relief
Average savings: National Debt Relief says its clients see savings of about 30%. By comparison, competitor Freedom Debt Relief says its customers see savings of 15% to 35% when including fees.
Minimum debt requirement: National Debt Relief requires a minimum of $7,500 in unsecured debt to qualify, the same amount as Freedom.
Customer experience: The company is accredited by the Better Business Bureau with an A+ rating and around 80 customer complaints in the past three years. The complaints centered on problems with the product or service, billing and collection issues, and advertising and sales issues.
Freedom Debt Relief has more than 350 customer complaints at the Better Business Bureau in the same timeframe.
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Whats The Difference Between An Original Creditor A Debt Buyer And A Collection Agency
Original creditors are the people or companies you borrow from like banks that make personal loans or credit card issuers. Protections guaranteed by the Fair Debt Collection Practices Act do not apply to original creditors.
So while debt collectors have to leave you alone once you ask them to stop contacting you, original creditors may be able to keep calling. Your state may or may not have laws in place to protect you from aggressive collection efforts from your creditors.
make money by collecting debt for others. Original creditors may turn accounts over to collections and pay the agency a fee for collecting, or they may sell the debt at a discount to the agency. Debt collectors are covered by the FDCPA and must stop contacting you if you ask them to.
Debt buyers purchase the right to collect a debt from original creditors or collection agencies. Debt buyers own the debt and have the same legal rights as original creditors unless their main business is debt collection. In that case, they fall under the FDCPA, just like collection agencies.
What Happens After A Debt Collector Contacts You
Within five days after a debt collector first contacts you, the collector must send you a written notice that tells you the name of the creditor, how much you owe, and what action to take if you believe you do not owe the money. If you owe the money or part of it, contact the creditor to arrange for payment. If you believe you do not owe the money, contact the creditor in writing and send a copy to the collection agency informing them with a letter not to contact you.
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How Much Does Debt Relief Cost
Debt relief companies tend to offer a free consultation to get the process started. From there, they charge performance-based fees that typically work out to a percentage of the debt amount you have enrolled.
Based on the companies we profiled, common debt relief charges work out to 15% to 25% of the total debts enrolled in a program. This means that, if you sign up for a debt settlement program with $10,000 in credit card debt, you may wind up paying $1,500 to $2,500 to get it resolved. And remember, thats on top of the amount you pay your creditors to settle your debts.
Best National Debt Relief Programs
When bills are piling up and you begin to fall behind on payments, debt relief programs can provide much-needed assistance to get out from the under the weight of all those unpaid notices and back on the path to good credit. Keep reading for our take on how to approach seeking out debt relief programs.
There is a small aquatic plant, called duckweed, that can expand from a few small leaves and take over the entire surface of your aquarium in a matter of months. While many fishkeepers will argue that duckweed has its place in moderate amounts, it can help keep your water clean too much of it can be a serious problem.
Unfortunately, debt can be much like that prolific plant what starts as a little helpful debt can quickly grow well beyond beneficial levels. But while duckweed can be controlled with a handy net, debt relief may often require a little outside assistance for the best results. Lets explore our picks for some of the best debt relief companies out there today, learn about whether government programs can provide assistance, and take a closer look at how debt relief actually works.
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Few Government Debt Relief Programs Exist
Although the US federal and state governments often provide a number of programs designed to help those with low incomes and/or bad credit, debt is, unfortunately, something youll likely have to handle without government help.
Thats because few government debt relief programs exist at the national level, and state-run or sponsored programs seem to be equally few and far between.
In general, if your debt is from credit cards or personal loans, youll likely need to stick with civilian programs and companies. If your debt problems involve student loans or a home mortgage, however, you may have some options.
For instance, some student loans can be forgiven, canceled, or discharged under specific circumstances, such as loan forgiveness for working in public service or as a public school teacher.
When it comes to mortgage debt, you may find a little help from the government through the Home Affordable Refinance Program . Keep in mind there are specific qualifications for HARP, such as being current on your payments.
Good News: Alternatives To Government Debt Relief Options
The good news for many people in debt is that there are a number of debt relief options that dont include the government. There are solutions for people in good financial shape and for those in a financial hardship and struggling with credit card debt.
Anyone with a good financial situation and good credit should look at their budget, assets, and credit. Perhaps paying off debt more aggressively or taking out a debt consolidation loan will solve your problems.
However, if you are struggling to make your minimum payments, and want to focus on paying off your debt and not your credit, then consider a debt settlement program. Fortunately, the industry is regulated by the government, so you never have to make any upfront payments. Private industry, with firms such as BIlls.com sister company Freedom Debt Relief, now offer you debt relief in cases where the government cannot help.
Need Help Finding a Non-Government Debt Relief Tactic?
Is Government help not enough? With just a few questions and a soft pull on your credit, you can get a free personalized solution to help you get debt-free.
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Best Overall: National Debt Relief
We chose National Debt Relief as the best overall in our ranking based on its track record for results, overall transparency, and a money-back guarantee. National Debt Relief has several examples of massive reductions of credit card balances on their website, showcasing their abilities.
More than 10 years in business
Proven results settling debts for less than consumers owe
No upfront fees
Does not handle certain types of debts like mortgages
National Debt Relief was founded in 2009 with the main mission of helping consumers get out of debt through a reliable debt settlement program. This firm is incredibly transparent about its process and resultsthey share examples of what they’ve done for past clients on their website: $15,000 reduced to $3,000 in debt, $22,500 reduced to $8,000, and $11,000 reduced to $2,000 in debt.
National Debt Relief helps consumers begin the process by offering a free consultation with one of its debt counselors. From there, you will have the option to explain your situation and talk over potential solutions, including using National Debt Relief for debt settlement.
Like other debt settlement programs, this company has you set aside a specific amount of money in a separate account each month, which you will later use to settle your debts for less than what you owe. In the meantime, National Debt Relief helps coordinate your efforts and negotiates with your creditors on your behalf.
Seek Help From A Government Funded Credit Counseling Agency
The U.S. Department of Housing and Urban Development certifies credit counseling agencies, which are close to qualifying as a credit card debt relief government program and can create a debt management plan for the debtor. The way credit counseling agencies work is that, after a free initial session, the debtor pays the agency a monthly fee. The agency then works out a reduced payment plan with the credit card company. In exchange, the credit card company will often agree to end any lawsuits or collection plans as long as the debtor is on the plan.
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Irs Fresh Start Program
The government has programs to relieve crushing tax debt. If youve fallen far behind on income taxes owed to the government, the IRS has set up the Fresh Start program, a series of rules changes that make it much easier to pay back that debt to the government. One part of Fresh Start makes it easier to use a government debt consolidation program called an Installment Agreement for repaying multiple years of back taxes. The other part of Fresh Start makes it easier to use the governments tax debt settlement program, known as an Offer in Compromise.
Other Options For Relief
If youre not sure you need professional help, there are other options you can use to find relief. Remember, debt relief refers to any solution that gives you a fast, easy, or cheaper way to get out of debt. There are plenty of do-it-yourself debt relief options to consider besides formal debt relief programs. You can work directly with a creditor or lender to find a solution you can afford.
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Extension For Federal Payment Suspension
Joe Biden extended the federal loan payment suspension and interest waiver for the third time on December 22, 2021. As a result, until May 1, 2022, federal student loans would be free of interest.
There was no mention of a loan cancellation or forgiveness program in that announcement. But President Biden encouraged borrowers to play their part in preparing for repayment.
After the Administration stated in August that its announcement would be the final extension of the CARES Acts loan interest waiver, it came as a bit of a surprise.
Jen Psaki, White House Press Secretary, said Biden had not decided when he was asked the day before about the possibility of the president enacting more loan forgiveness or extending the payment freeze.
Borrowers are waiting for information about significant student loan forgiveness, as promised by President Biden during his campaign. And its uncertain whether the payment moratorium will be prolonged beyond August 2022.
The Biden Administration has chosen a gradual approach to student loan relief as it investigates its legal power to seek larger loan forgiveness schemes without congressional approval. It continues to pursue its agenda with slim majorities in Congress.