Credit Card Debt Laws

Credit Card Debt Laws can be very confusing at times, with so much false information out there, how do you know who to trust?...

Do you know that the average household owes over $15,000 in credit card debt? Shocking isn't it? Credit card companies usually charge anywhere between 20% to 25% annual percentage rates. That is almost $4000 per year in interest alone.

Even if a person is making the minimum monthly payment, it would still take approximately 5 to 10 years to pay it off completely. The new Credit Card Debt Laws enacted earlier this year will help to protect you from these companies that overcharge.

Companies can no longer raise interest rates on existing balances, raise interest rates due to other credit issues or double cycle bill.

On top of that, a company must allow enough time for you to pay the bill before it's late and outline clear due dates and times.

There are several things you can which will help in reducing your debt and pay it off much faster.

The very first thing you need to do is stop yourself from using your charge cards. Cut them up and dump them into the garbage bin, lock the cards in a drawer and give the keys to someone you trust, put the cards in the paper shredder, do whatever it takes to stop you from using them.

Then quickly contact a debt settlement company, one that is certified by The Association for Settlement Companies (TASC). The company should also need to have a good record from the Better Business Bureau, every company will be given a grade by the BBB. Also, make sure the debt settlement company is aware of any new credit card debt laws that may be in effect in your state.

Some settlement companies can reduce the actual dollar amount you that owe. For example, a person who owes $20,000 may be able to work with the company in order to pay a certain amount on the dollar. You may offer the company $0.60 on the dollar, which would reduce the $20,000 to only $12,000. If the company counter offers $0.80 on the dollar, then take it. That means you just reduced the actual dollar amount owed to $16,000. You just saved yourself $4,000.

Depending on which state you are living in, there are laws that help protect the consumers. In Illinois for instance, credit card debt laws exist to prevent collection agencies from harassing you. Debt collection agencies are not allowed to call your place of work or your house late at night. Collection agencies in Illinois cannot charge more than 5% interest on any uncollected debt. The Illinois Wage Protection Act states that a collection agency can only collect on debt that amounts to no more than 85% of your disposable earnings. Try to understand your rights. Take control of your credit card debt.

Legal matters seem to be always be complicating because for some reason lawyers have a way of confusing even the simplest matter.

Although many things are regulated on a national level, many more credit card debt laws that are regulated and mandated on a state level. The cool thing about the federal regulations is that across the whole of the United States everything is the same, finding out how a law applies is as easy as it applies to everyone in the United States.

Every state has a different view on what is legal and what is not. Finding the law that applies to you can be difficult. You need to figure out if the law applies to where you live now or where you lived when you incurred the debt which can be confusing.

The best is to consult an attorney about the credit card debt laws. There is no guarantee though. Sometimes, lawyers are oftentimes just as confused as anyone else.

Anyhow, there many debt companies out there that will help you with legal matters in regard to credit card debt law. Some companies involve attorneys and some do not.