Laws Affecting Debt Elimination

Debt is a word many people prefer not to deal with due to the severe consequences it can have on one’s life. Families have been broken, wars have been started; the reason behind it all being debt. A very popular way for people to get into debt is the credit card. Credit cards are a fast growing method of payment. Most, if not all online payments are made using credit cards and people usually prefer carrying credit cards as it is claimed to offer a more secure way of carrying your money. However, this may be the complete opposite. People usually tend to splurge more when using a credit card than when paying for their shopping using hard cash. This tendency to spend leads to a large portion of the public spending more than they can actually afford. Eventually, people start delaying the settlement of their monthly bills, which are most of the time an unpleasant surprise. The urge to spend however does not go away as the credit card still allows them to spend, even when they cannot afford it.

Overtime people find themselves in debt they know they cannot settle. As a result, they may end up liquidating their assets to settle these debts and in cases where people do not posses sufficient assets to cover their debts; they have to file for bankruptcy.

Credit cards may not be the only reason for this kind of excess debt. Mortgages, personal loans in excess of one’s income may eventually lead to excess debt. The recent recession is plenty proof for that. As mentioned before, the main action that can be taken when a person has excess debt is to either settle it by liquidating assets or by filing for bankruptcy. However, there is a new player in the field; debt elimination laws.

Debt elimination laws are of different types. Though some debt elimination laws maybe legal; like credit counseling and voluntary repayment plans, many of the debt elimination laws publicized on the internet are scams.

These debt elimination laws scams usually convince people to pay large amounts up-front and commissions, depending on the amount of the debt involved. The so called “debt elimination laws” claim to exploit loopholes in the system to eliminate a person’s debt, whether it is a mortgage or personal loan. People have fallen for the debt elimination laws and ended up paying large sums which only adds to their loss.

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