While there are many companies that offer real debt consolidation plans and debt settlement options, unfortunately there are also some companies out there that that outright scam customers. These companies offer to help settle your debt for a fraction of the debt amount. Then these companies have you pay all kinds of fees before they even start working to settle your debt. But in many cases these companies do nothing more than collect these fees. They never follow through on the debt settlement options, and you are left holding the debt!

So in response to the numerous complaints against these companies the Federal Trade Commission (FTC) is attempting to set new regulations that would govern companies who offer debt consolidation plans. The biggest change proposed will limit, or completely eliminate, upfront fees and charges.

This of course would nip the problem right in the bud. The fly by night companies that are making money by charging these fees and then providing no service would have their business model destroyed. These unscrupulous businesses would literally disappear overnight.

But there could be another unintended consequence. The same new rules designed to help consumers could backfire. The new proposed rules could actually keep consumers from having any debt settlement options at all.

Companies that do offer genuine debt consolidation plans could be put out of business too. After all, these are businesses and any business needs to make money. These new rules would essentially mean that the legitimate companies would be prohibited from charging their customers for the services that they provide.

While the legislation is needed it does propose a Catch 22 situation. We're hopeful that these shady companies disappear, and are ready and willing to step in to help consumers with our debt settlement solutions.