by Debt Settlement Reviews on January 27, 2011
It has been quite a while since we’ve made a post and a lot has happened in the settlement industry since the FTC changes took effect 3 months ago. Most of the smaller debt settlement companies have shut down operations. You can see the huge consolidation in the industry just by looking at the massive drop in members on the TASC, USOBA and IAPDA sites.
TASC had over 200 active members around 6 months ago, they are now down to 62.
What does this mean? For most consumers, you can be assured that if a company made it through this transition, they should be financially stable enough to not go out of business while you are working with them. For us, this means that most of our reviews are outdated and many of the companies we have reviewed are now out of business. We will be making a huge effort over the next few months to update existing reviews and write new reviews for companies that are still active in the industry. Companies with updated reviews will have a note at the top of their page indicating that update and the date on which the update occurred.
Keep one thing in mind. Just because a company made it through this transitional period does NOT mean you should work them. Please perform your due diligence and use this site as a reference.
by Debt Settlement Reviews on July 30, 2010
Yesterday (June 29, 2010), the Federal Trade Commission (FTC) made a HUGE announcement on new rules that govern the Debt Relief industry. These rules will greatly affect the debt settlement industry’s future. The rules change a number of things, here are the highlights:
- Debt Settlement companies can no longer charge any fees until they have settled your debt
- More disclosure of information required – this includes exact program costs and length as well as negative consequences
- Can no longer make false or unsubstantiated claims about the service
These rule changes go into effect on October 27, 2010. Of these 3, the first one is obviously the biggest change. Almost all settlement companies charge 15% of your total debt amount which generally means your first 3 full payments plus part of your monthly payments for the first year. TASC has fought this change vigorously and claims it will put many settlement companies out of business.
What does this mean for you, the consumer? It means that there is going to be a very turbulent period over the next 6 months in the industry. A large amount of settlement companies will undoubtedly shut down because of this. I would strongly suggest people to try to wait things out until the end of the year if you are thinking about signing up for a debt settlement program. Another good option is to try a do it yourself debt settlement program.
