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3 Important TSR Guidelines To Consider When Getting Debt Help

man shouting at a phoneWhile people are capable of finding debt freedom on their own, getting debt help makes it a whole lot easier. For some, this is a necessity because they do not have the qualities that will make debt relief a success.

If you think that you are one of them, you need to be careful when selecting the debt relief company that you will hire to help you. There are many scammers out there who will get your hard earned money. Instead of solving your debt problems, they will put you further into the crisis that you are in.

An article published last 2013 in the Better Business Bureau site discussed the results of a study conducted by the Federal Trade Commission. According to the study done in 2011, more than 10% of American consumers have been scammed. The results discussed in the article revealed that 25.6 million adults have at one point in their lives, been victims of fraudsters. Of that number, 1.5 million are victims of debt relief scams.

When you are getting debt help, you have to make sure that you will not be a part of this statistic. It does not take a rocket scientist to do it. If you are intent on getting help from debt professionals, you need to know about the Telemarketing Sales Rule (TSR).

Role of the TSR in the debt relief industry

There are many debt relief laws that protect consumers from being scammed. People in debt can sometimes get desperate and that makes them more susceptible to be fooled by thieves. Make sure that does not happen to you. It is vital for you to keep a clear head so you can protect yourself from these people. And that protection, begins with knowledge. If you are going hire a debt relief company, make sure you read the Telemarketing Sales Rule first.

So what is the role of the TSR in the debt relief industry? According to the publication from the Federal Trade Commission site,, the TSR was created to:

  • Help combat fraudsters especially those selling false services/products through telemarketing.

  • Provide consumers with privacy protection.

  • Aid consumers to defend themselves against illegitimate telemarketers.

  • Guide consumers to determine the legitimate from the the illegitimate companies.

  • Prohibit the calling of consumers who listed themselves with the National Do Not Call Registry.

  • Give companies with guidelines to keep them from misleading or abusing consumers.

As you can see, knowing the TSR will guide you as you are getting debt help. It will keep you from being scammed because you know how the legitimate companies should act. If a company violates this rule, you will know immediately and that will keep yourself from being scammed.

3 important qualities of a debt relief company, according to the TSR

Some people are scared of getting debt help because they are skeptics. Although the presence of scammers are there, you have to know that there are also sincere and trustworthy companies out there.

To help you find the best debt relief company who can help with your credit problem, you may want to consider these 3 qualities based on the TSR guidelines.

Does not ask for upfront payments.

A clear and early sign of a debt relief scammer is when they ask you to pay them even before they have done something for you. No legal debt relief company will violate this rule. Most of them will offer free initial consultations and will never ask you to pay upfront fees. According to the TSR, they are only allowed to ask for any form of payment once they have provided proof of their compliance with any part of the contract. This includes debt payment plans, documented agreements with the creditor, and/or payments made that is according to what have been agreed upon. It has to be noted, though, that this law allows debt relief companies to set up escrow accounts to help secure their payments.

Complete disclosure of process, fees and relevant information about the company.

Another quality that you need to look out for is the full disclosure of information – especially with the fees. Before you sign any contract, it has to be clear with you what will happen and the costs involved in the process. They cannot ask you to pay something in the midst of the program that is not included in the original contract or discussed before the start of the debt solution.  The debt relief company should inform you about the consequences of each debt relief choice that you have (e.g. credit report implications, etc).

This particular rule also protects the money of the consumer. In most cases, the consumer is asked to open an account where they will put their money for debt payments. This is where the debt relief company will get the money to send to the creditors. This rule mandates debt relief companies to ensure that these accounts are to be FDIC insured and that the customer will maintain full control over it.

Should not misrepresent their services.

Apparently, there are companies that advertise certain services and promises results that are not entirely truthful or guaranteed. They do this to entice clients to sign up with them. When the clients sign the contract, that is when they find out the real score regarding the company they are getting debt help from. The TSR prohibits these kind of deceptive measures and consumers are encouraged to report violators.

If you are certain that you cannot find debt relief without professional help, then we highly encourage you to go to the FTC website to know more about the Telemarketing Sales Rule.

Debt solutions that does not require professional help

You should know that there are ways for you to achieve debt freedom on your own. It really depends on the type of debt solution that you will choose to follow. In most cases, people only need to restructure their debt payments to make it more organized and affordable. Here are four debt relief programs that you can use as a do-it-yourself debt solution.

  • Snowball/Avalanche Method. These two methods simply requires you to list your debts according to priority so you can pay a bigger amount to your priority debt while paying the minimum for the rest. For the snowball, the priority will be the lowest balance. For the avalanche, the top debt will be the one with the highest interest rate. Obviously, the first debt will be paid off faster and when that happens, the funds from that will be transferred to the next priority debt – and so on and so forth.

  • Debt Consolidation Loans. This option involves getting a loan that is enough to pay off your multiple debts. Once approved, you will pay everything else and you will concentrate on this one debt. The goal is to simplify your payment plan by consolidating it under one lender. In most cases, the new loan will mean a lower interest rate – especially if most of the debts are credit card accounts.

  • Balance Transfer. This debt relief program involves transferring the balance of high interest credit cards into a new zero interest balance transfer card. These card are still like credit cards but you can transfer your credit card debts to take advantage of the 0% interest. Any payment made would be credited to the principal debt and will not accrue interest. This promo is only effective for 6 to 18 months so you have to create a payment plan to significantly pay off your debt within this period.

  • Debt Settlement. Lastly, you have debt settlement or debt negotiation. There are companies who offer debt negotiation services but this is a debt solution that you can do on your own. Do-it-yourself debt settlement is possible as long as you know the rules and your rights as a consumer. All it takes is for you to convince your creditor that you are in a financial crisis and negotiate for them to allow you to pay only a portion of what you owe (e.g. 40 cents to a dollar). When they agree, you will pay the settlement amount and the rest of your balance will be forgiven.

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