When people are struggling to make ends meet, they often need a solution to get out from mounting debts. Some consumers are forced to use credit cards just to buy food and gas. These bills can pile up quickly and it may become difficult pay the monthly minimum required. A Minnesota debt consolidation program may be a solution worth investigating.
Choosing a Consolidation Program
Choosing a Minnesota debt consolidation program allows consumers to have the high credit card interest rates lowered, thereby reducing the financial and emotional stress you may be experiencing. You can pay down the bills in two different ways:
- Minnesota Debt Consolidation Program—Whether you have retail credit cards, personal loans, medical bills or large utility bills, you can consolidate all of these by enrolling in a consolidation program. A representative from the company will negotiate with your creditors to have the interest rates and penalties reduced. The goal is to help you get out from insurmountable debt and ensure that you can make your payments each month.
- Minnesota Debt Consolidation Loan—This is a personal loan for people who can’t make payments on their bills at regular times during the month. Most lenders will look for borrowers who have both a steady income and good credit score. Many Minnesota debt consolidation loans are available in large amounts allowing you to repay most of your current bills.
Most Minnesota debt consolidation programs are aimed at consumers who have at least $5,000 in unsecured debts. Once your debts are consolidated, you will make one payment to the company each month and this will be divided up among each of your creditors.
Common Tactics Used By Collection Agencies
The Fair Debt Collection Practices Act (FDCPA) that was enacted in 1996, is aimed at protecting consumers from abusive tactics used by debt collectors. They are prohibited from the following:
- Calling you at home before 8 am or after 9 pm local time.
- They cannot call you at work if your employer disapproves.
- Once you notify the debt collector in writing to stop contacting you, they must comply with this request.
- Debt collectors are required to send you a written notice informing you of how much is owed on the account.
- Threatening to have you put in jail for not paying your bills.
- Making racial slurs or threatening you or your family in anyway.
- They cannot contact a third party, such as a neighbor or relative that does not owe money to the creditor.
Any debt collector who is in violation of the above should be reported to the Minnesota Attorney General and the Federal Trade Commission. Consumers may be able to seek damages for any debt collector who violates the law.
Has the Statute of Limitations Run Out?
The law limits the amount of time in which a debt can be collected. This is known as the statute of limitations and set the maximum period of time that legal proceeding can be initiated. Once this time has expired, the debt collector cannot take any further action. In the State of Minnesota, the statute of limitations is listed below:
- Oral Agreements—6 years
- Written Contracts—6 years
- Promissory Notes—6 years
- Open Accounts—6 years
Most auto loans and installment type agreements are considered to be written contracts whereas credit cards are considered open accounts.
How to Avoid Getting Ripped Off
Before choosing a Minnesota debt consolidation company, do some homework and check out the company’s reputation by checking with the Better Business Bureau. Their website allows consumers to enter the name of a business to find out if any complaints have been lodged against the company.