Last year new Chapter 7 bankruptcy laws made significant changes to the requirements needed to file for bankruptcy. Now in addition to showing that your income is lower than the median income of your state of residence, all consumers filing also have to undergo debt counseling. What does this mean for consumers? More agencies like AmeriDebt (shut down by the Federal Trade Commission) claiming to consolidate your debt while scamming money.
Consumers have to be more aware then ever about the debt consolidation process, and what is and isn’t acceptable. Typically a good debt management service will consolidate high interest account while bringing a debtor’s accounts current without the penalty of paying late fees and back payments.
Non-legitimate counseling agencies may ask for upfront fees, or what they call “voluntary contributions” for the agency’s services. Also, you should not have to provide specific details about your situation, nor should you give your account numbers in order to get a quote.
Basically it is the consumer’s job to look into all of their options and to check out any possible counseling agencies with the Better Business Bureau or their state Attorney General. ■
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