Sunday, February 13, 2011

Consumers better off without debt settlement

New research from the Center for Responsible Lending compares consumers that used debt settlement firms with those that settled their debts on their own. Not surprising, consumers who did it themselves saved money because they were often able to negotiate a hardship rate of 10% APR and were able to pay off the debt more quickly. Researchers found that any fee above 18% results in a net loss for the consumer.

MCRC is supporting Del. Vaughn's bill in the House which caps fees at 20% of the debt, provides stronger consumer disclosures, and regulates lawyers who run debt settlement firms as well as other debt settlement providers.

For a one-page factsheet of CRL's research, contact MCRC at: marceline@marylandconsumers.org

Contact your legislator here: http://mlis.state.md.us/and tell them you support regulating these firms-Marylanders need real debt relief.

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