Consumers in California have reason to celebrate as a new law was passed in their State to protect them against abusive debt collectors.
One of the causes of debt stress are the abusive practices of debt collectors. Those who are in debt know about their responsibility and that makes it easy for collectors to intimidate them. And if they are not aware of their rights, then it will be easy to bluff them and dupe them into paying even if they cannot afford it.
Recently, the California Senate passed a bill that required debt collectors to submit proof that the person they are calling to collect debt from is indeed the owner of that particular debt. Otherwise, they are in violation of SB-233 Debt Buying.
It is very important that consumers know their rights when they are getting out of debt. Knowledge will be your best asset when you are trying to battling down your debts. For instance, you need to know that abusive practices in general are in violation of the FDCPA or Fair Debt Collection Practices Act. This is implemented by the FTC or Federal Trade Commission. You cannot be threatened or harassed by the debt collectors. By knowing your rights, you will identify any bluffs that the collectors may be throwing your way.
The same is true when you are choosing a debt relief option. Researching on the different ways that you can get out of debt will be your best arsenal against your financial problems.
For instance, if you have enough money for minimum payments and you want to take care of your credit score, debt consolidation is the best way to accomplish that. This debt solution will allow you to make debt payments more manageable because it provides you with a single payment plan. Not only that, this program will help lower your monthly payments. It will free up funds in your budget so you can grow your savings. By doing so, you can be on your way towards financial stability as you work on paying off everything that you owe.
But if you want a bigger reduction, you may want to consider debt settlement that aims for debt reduction. This method involves negotiating with your creditors so they will allow you to pay only a percentage of your debt and have the rest of it forgiven. This is more tricky to accomplish because the collector may drag it out and it will ruin your credit score – although not as much as bankruptcy will. If you opt for this, you need to do more research on the law protecting you as a consumer so that you will not be abused as you try to negotiate.
Both of these will help you but the bottom line is, you have to know which one is best for you. There is no one formula to get out of debt and you have to base it on your financial capabilities. By doing so, you can find the right solution that you can afford and complete.