Who: The Federal Trade Commission, which enforces the Telemarketing Sales Rule, has developed the new rules.

The rule applies to all for-profit debt relief agencies that sell debt relief services over the telephone, including those that discuss settlement over the phone with prospective clients. In other words, they don’t have to be cold-calling consumers to be covered by the rule.

When: These final amendments are effective on September 27, 2010, except for the upfront fee ban, which is effective on October 27, 2010.

What: The Rule will:

(1) prohibit debt relief service providers from collecting a fee for services until a debt has been settled, altered, or reduced;

(2) require certain disclosures in calls marketing debt relief services; and

(3) prohibit specific misrepresentations about material aspects of the services.

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Most services provided by BPO vendors are offered on a fee-for-service basis. This can help a company becoming more flexible by transforming fixed into variable costs. A variable cost structure helps a company responding to changes in required capacity and does not require a company to invest in assets, thereby making the company more flexible. Outsourcing may provide a firm with increased flexibility in its resource management and may reduce response times to major environmental changes.

Another way in which BPO contributes to a company’s flexibility is that a company is able to focus on its core competency, without being burdened by the demands of bureaucratic restraints. Key employees are herewith released from performing non-core or administrative processes and can invest more time and energy in building the firm’s core businesses. The key lies in knowing which of the main value drivers to focus on – customer intamacy, product leadership, or operational excellence. Focusing more on one of these drivers may help a company create a competitive edge.

A third way in which BPO increases organizational flexibility is by increasing the speed of business processes. Using techniques such as linear programming can reduce cycle time and inventory levels, which can increase efficiency and cut costs. Supply chain management with the effective use of supply chain partners and business process outsourcing increases the speed of several business processes, such as the throughput in the case of a manufacturing company.

Finally, flexibility is seen as a stage in the organizational life cycle. BPO helped to transform Nortel from a bureaucratic organization into a very agile competitor.  A company can maintain growth goals while avoiding standard business bottlenecks.  BPO therefore allows firms to retain their entrepreneurial speed and agility, which they would otherwise sacrifice in order to become efficient as they expanded. It avoids a premature internal transition from its informal entrepreneurial phase to a more bureaucratic mode of operation.

A company may be able to grow at a faster pace as it will be less constrained by large capital expenditures for people or equipment that may take years to amortize, may become outdated or turn out to be a poor match for the company over time.

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If you choose to enter into a Debt Settlement program with $20,000 on average your total amount of debt would be reduced to $11,600 including the debt settlement company’s fees. You would end up saving a total of $50,003.50 in interest and a total of $8,400 in your principal balance. Making your grand total savings of $58,403.50! If you continue paying $400 per month in a debt settlement program you will be completely debt free in 33.14 months. Under 3 years!!

Interest rates

Interest rates vary widely. Some credit card loans are secured by real estate, and can be as low as 6 to 12% in the U.S. (2005). Typical credit cards have interest rates between 7 and 36% in the U.S., depending largely upon the bank’s risk evaluation methods and the borrower’s credit history. Brazil has much higher interest rates, about 50% over that of most developing countries, which average about 200% (Economist, May 2006). A Brazilian bank-issued Visa or Mastercard to a new account holder can have annual interest as high as 240% even though inflation seems under control at around 6% per annum (Economist, May 2006). Banco do Brasil offered its new checking account holders Visa and Mastercard credit accounts for 192% annual interest, with somewhat lower interest rates reserved for people with dependable income and assets (July 2005).[citation needed] These high-interest accounts typically offer very low credit limits (USD$40 to $400). They also often offer a grace period with no interest until the due date, which makes them more popular for use as liquidity accounts, which means that the majority of consumers use them only for convenience to make purchases within the monthly budget, and then (usually) pay them off in full each month.

Calculation of interest rates

Most U.S. credit cards are quoted in terms of nominal APR compounded daily, or sometimes (and especially formerly) monthly, which in either case is not the same as the effective annual rate (EAR). Despite the “annual” in APR, it is not necessarily a direct reference for the interest rate paid on a stable balance over one year. The more direct reference for the one-year rate of interest is EAR. The general conversion factor for APR to EAR is EAR=((1+APR/n)^n)-1, where n represents the number of compounding periods of the APR per EAR period. For a common credit card quoted at 12.99% APR compounded daily, the one year EAR is ((1+.1299/365)^365) -1, or 13.87%; and if it is compounded monthly, the one year EAR is ((1+.1299/12)^12) – 1 or 13.79. On an annual basis, the one-year EAR for compounding monthly is always less than the EAR for compounding daily. However, the relationship of the two in individual billing periods depends on the APR and the number of days in the billing period. For example, given 12 billing periods a year, 365 days, and an APR of 12.99%, if a billing period is 28 days then the rate charged by monthly compounding is greater than that charged by daily compounding [ .1299/12 is greater than ((1+.1299/365)^28)-1]. But for a billing period of 31 days, the order is reversed (.1299/12 is less than ((1+.1299/365)^31)). In general, credit cards available to middle-class cardholders that range in credit limit from $1,000 to $30,000 calculate the finance charge by methods that are exactly equal to compound interest compounded daily, although the interest is not posted to the account until the end of the billing cycle. A high U.S. APR of 29.99% carries an effective annual rate of 34.96% for daily compounding and 34.48% for monthly compounding, given a year with 12 billing periods and 365 days.

*Interest rate information from Wikipedia


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Filing for bankruptcy is a difficult decision to make. While filing Bankruptcy can assist you in alleviating your dues and debts, it can also affect you more adversely than you can think of.

Bankruptcy can have disturbing effects on personal and professional life for longer duration. It affects your credit rating and borrowing capacity in near future. Hence, declaring bankruptcy should be considered as last resort.

There are other alternatives available which can pull you out from such awkward positions. There are numerous reasons for people to avoid bankruptcy.

1. People filing bankruptcy have to bear the loss of their assets. In most of the cases court used to sell those assets like house, plot or even car to clear off debts.
2. Whenever you file for bankruptcy, then control goes to the magistrate handling your case and your fate can be decided by him judging the information received by Official Receiver.
3. Bankruptcy has a very devastating effect on your credit history for at least next 7 years. With such a poor credit score it becomes very difficult to get a loan or mortgage to start a fresh life.
4. Declaring bankruptcy can ruin your career prospectus. There are certain careers which do not accept you if bankrupt. Even there are few restrictions on being director or owning business.
5. Being bankrupt hampers your social life to much extent. It is quite embarrassing situation once your bankruptcy gets advertised in newspaper.

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Clients pay the credit counseling firms directly, either through consolidation or monthly payments. The agency then takes care of paying the bills. These companies help consumers in several ways. The most important service they provide is skillful negotiation with lenders. Since creditors have widely varying policies, the counselors must be up to date on the most current information. They can then use that information to bargain for a lower interest rate reduced payments, or even consolidation of certain loans. In addition, they can provide advice on budgeting, handling money, and effectively operating in the financial world.

If the situation has progressed, debt settlement becomes a possible option. In this process, the consumer or company representative negotiates to reduce the principal amount of a loan. Although many people do not know about this, it can be done by any borrower. First, the loan must be declared to be in default. This may have happened already if no payments have been made for several months. Once defaulted, a loan becomes a loss to the lender, which means that the lender will often accept a much smaller total amount in order to recover at least some of the money owed. Settling debt will eliminate debt more quickly and efficiently.  Debt Aid Processing offers the best alternative to bankruptcy available to the consumer.

Getting out from under a financial burden can be the first step to success. Becoming an affiliate of Debt Aid Processing will allow you to offer seasoned advice on the right personal debt management plan. The best option is dependent on personal preference, financial goals and the current economic climate. Taking all these factors into consideration can help resolve debt problems with a minimum of negative consequences.

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The key to successful debt settlement is negotiation and it’s a skill anyone can learn. Just follow these seven simple steps to do it yourself. Remember when you negotiate, you’re not only reducing the amount you pay individual credit card companies each month. You’re also lowering your total debt by 50 to 80 percent.

Once you start negotiating with creditors you’ll find that settlement amounts will vary. Some may offer as low as 30% and others up to 50%. Some will even forgive most of the amount you owe. Try it and in about six months you’ll be off to a fresh start.

Here are seven debt settlement and creditor negotiation steps you can do yourself:

1) First you need to accumulate a sizable amount of unmanageable debt, which you’ve probably already done since you’re thinking about settling.

2) Next you have to determine that debt settlement is your best option.

3) Once you make that determination, stop making your monthly payments.

4) Take the money you would have spent making those payments and put it into a savings account. Or if you can, try to get a loan with a low or zero percent interest rate from family or friends.

5) Begin negotiating with creditors about five to six months after you stop paying your monthly bills.

6) Negotiate with each creditor until you get them to agree to settle for 50 to 80 percent of the balance owed.

7) Get each creditor to send you a written settlement letter that specifies the terms that were agreed to. Do not skip this step!

Wondering why creditors would agree to settle so low? Let’s face it. If you can’t pay your bills each month, creditors realize you probably won’t ever pay the balance. They know you have the option to file for bankruptcy and that if you do, they might not get any money from you at all, depending on the outcome.

They could hire a debt collector, but they have to pay for that service, which further cuts into the amount they recoup. If your account has passed the charge off date, a creditor might sell the account to a collection agency for a measly five or ten cents on every dollar. As you can see, settling is sometimes their best option.

Good luck with your negotiations. You can do it!

In order to find out more about debt settlement processing, you can visit our site Debtsettlementprocessors.com.

Krista Scruggs is an article contributor to Debtsettlementprocessors.com. Debtsettlementprocessors.com is an informative site about debt settlement processing which also connects consumers with service providers that can help them avoid bankruptcy. We have several Debt Settlement companies within our network, each with their own strengths and specialties. Depending on your specific situation (the amount of debt owed, nature of your debt, your credit, your hardship, and any other unique situation you might be in), we will match you up with the right company.

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Debt Aid Processing at the TASC 2010 in Las Vegas

[View with PicLens]

Debt Aid Processing attended the TASC 2010 conference at the Venetian Hotel in Las Vegas on March 14 to 16, 2010.

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Debt Aid Processing at the TASC 2010 Conference, Charting the Course through change

Debt Aid Processing will be at the TASC (The Association of Settlement Companies) 2010 Conference on March 14 to 16, 2010 (Sunday to Tuesday) at The Venetian, Las Vegas.

Visit us at Booth no. 17.

The Venetian Resort Hotel Casino
3355 Las Vegas Blvd. South
Las Vegas, NV 89109

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Chapter 13 Bankruptcy- In this type, the debtor proposes a plan to repay creditors over a three to five year period during which the debtor can make up overdue payments on any assets and pay into the plan the equivalent value of any assets not covered by exemptions.  Exemptions refer to properties that the law allows for the debtor to keep.  The debtor will then make regular payments to creditors through a trustee and will not be discharged of the debt until the payments are complete.  The debtor is, however, protected from wage garnishments, lawsuits, and other creditor action while making the payments.

Chapter 7 Bankruptcy-This type requires the collection of the debtor’s assets by a trustee who then distributes the cash obtained from those properties to creditors.  In order for creditors to receive any money from the assets, they need to file a claim with the bankruptcy court which will deem their claim justified as it sees fit.

Filing bankruptcy is not only stressful and time consuming, it has more serious consequences.  It can impact a credit score for at least six years and nine months, and possibly up to ten years.  This will make trying to get one’s life back on track very difficult.

How can bankruptcy be avoided? Debt settlement.  We are Debt Aid Processing, one of the nation’s largest and most successful backend processing companies.  We are here to offer resources to our affiliate companies in order for them to help their clients free themselves from the chains of debt.  Call us today at 800-510-2734 or visit our website at http://www.debtaidprocessing.com

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• medical bills
• credit cards
• department store cards
• personal loans
• student loans
• bounced checks

People are usually able to obtain money from these sources based solely on their good credit score.  This is the type of debt that settlement companies deal with.  The latter category, the secured debt, consists of:

• auto
• home

Here, there is real physical property at stake.  Because of this fact, secured debt cannot be settled.  The physical property, be it the home or car, will simply be repossessed by the creditor in exchange for failure of payment and defaulting on a loan.  Here at Debt Aid Processing, we are committed to providing our affiliate companies with the resources they need to get their customers out of debt and back on track.  For more information, call (800) 510-2734 or visit us at http://www.debtaidprocessing.com.

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