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Predatory lending has become a menace to many American citizens as unscrupulous lenders prey on needy people who can’t argue the terms on the financial products they are offered and thus accumulate more and more debt due to the high interest rates charged. Many don’t know that regulations are on their side though and that certain practices performed by creditors and collectors are illegal and thus open to judicial revision.
These creditors and unscrupulous lenders count on the fact that most people ignore the tools available to them to fight predatory lending and thus continue to prey on needy consumers while collecting millions of dollars that would otherwise help those in need to recover from the hardship that made them to seek finance. Fortunately there are both commercial and non profit institutions ready to fight in their name.
Debt Settlement Agencies
Debt settlements is a process by which expert legal advisors contact creditors on your behalf and negotiate with them reductions on your debt and new repayment programs to accommodate to your needs. Though each debt situation is different, debt settlement agencies have obtained up to 60% debt reductions from people’s creditors thanks to their legal expertise and negotiation skills.
There are many regulations that protect the rights of consumers. Since creditors and collectors often break these rules charging abusive rates or accounting interest rates in different ways than those prescribed by the regulations, the negotiators use this fact to threaten them to dispute the whole debt and usually obtain an agreement that includes a debt reduction and a reprogramming of the repayment schedule. This agreement is called legal settlement.
Credit Repair Companies
Credit repair companies specialize on credit reports, bureaus and disputing wrongful items that can appear on your credit history without you realizing that those negative inputs can be removed due to their illegitimacy. Just like with debt settlements, credit repair advisors know consumer rights regulations thoroughly and know exactly how to dispute items that are inaccurate or that can be argued due to legal technicalities.
But this is not the only thing that credit repair companies can do. They can also monitor your credit report to make sure no more wrongful entries are recorded into your credit history and thus, that your timely payments keep contributing to raising your credit score. These monitoring services also protect you from identity theft as you will be notified whenever a creditor has pulled your credit report to see if you authorized it or someone else is using your details to borrow money.
Additionally credit repair companies will also guide you through the process of legally improving your credit history. They won’t offer magic solutions; instead they will advice you on how to avoid negative inputs on your credit report by preventing missed payments and late payments.
These credit repair companies are mostly commercial institutions that charge a fee for their service. However, there are also non profit consumer organizations that offer the same kind of services for free or require only a contribution after providing you with the solutions to your credit problems.
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