Many people used to go for filing bankruptcy when debt settlement was not so common. These days, Credit card debts are very common. Bankruptcy is a shortcut method that can solve your problems temporarily but it's after effects are permanent. You should always try to save yourself from this option. Mostly people do not bother about their future lives and of course no one will care about credit card companies. In fact, these companies suffer a lot from this small action. The Government had to devise the credit laws for its citizens. It can not make decisions in favor of one party. So, the Federal Trade Commission made new laws. According to these laws, bankruptcies are made almost impossible to use. Chapter 7 and chapter 13 bankruptcies are specifically addressed in this bill.
Registration fees are increased and paper work is also increased. If your attorney is found guilty in providing incorrect information to bankruptcy court then severe action will be taken against him. Due to increased responsibilities, attorneys have also increased their fees. The Government has introduced many financial tests for accepting application for bankruptcy. Overall, the government has taken these steps to make it more difficult for the people to avail this option.
In the past, people were afraid of getting help of settlement companies because they were many companies that were involved in fraudulent services. They did more harm than good. It was a waste of time and money to consult them. New law has defined a rule and according to this rule, no company can ask for any upfront fees before doing a settlement deal and providing satisfactory results to the customer. Now, you do not have to worry about the shady companies. If a company asks for some fees then you should consult another firm. These laws are made to encourage people to use debt settlement instead of going for bankruptcy. Maximum fee that a settlement company can charge is 15% of the amount reduced. If you find any company who is involved in bad practices then inform the federal government so that other innocent people can be saved from these people and legal action can be taken against them.