Consumer Law

Debt-management firms are not working for you

By Randall Ryder

Thinking of using a debt-management firm? Think again. These services don’t help you as much as you think.

Many of these firms are not helping as much as their subscribers think—sometimes at least half of what the customers pay goes to administrative fees—money that is never paid on the customer’s behalf.

The Minnesota Legislature, at the behest of consumer advocate groups, recently passed legislation that regulates what debt-management firms have to disclose to consumers. The new law also regulates what these companies can charge consumers. But do not let the legislation fool you—these firms are not your best option to get out of debt.

New law tightens rules for debt firms | Star Tribune

(photo: Andres Rueda)

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Full post as published by Caveat Emptor on June 09, 2009 (boomark / email).