Arizona Debt Consolidation
Debt Help in Arizona
Debt is an overwhelming problem in America today. Some people who fall into debt trouble do so unwillingly. Often the loss of a job or medical bills affect those who otherwise handle their money well. When debt gets to the point that the consumer cannot pay even the minimum payment amount, a solution is needed. Some feel that bankruptcy is the only option, but there are other solutions available to help with debt in Arizona. Consumers living in Arizona and struggling with debt they cannot pay have several places they can turn for help.
Arizona Debt Consolidation and Credit Counseling
Debt consolidation is a popular option for dealing with debt, particularly when the debt is in the form of high-interest credit cards. Debt consolidation, which is typically a loan, puts all of the debt into one account. Sometimes the loan is a home equity loan or other secured debt, which then lowers the interest rate.
Before signing up for a debt consolidation program, take the time to talk to a debt counselor. Arizona debt counseling services aim to educate consumers about how to better use their money. There are many companies out there that claim to be credit counseling services. Before signing up with one, check the list of US bankruptcy court approved credit counseling agencies, which can be found at http://www.justice.gov/ust/eo/bapcpa/ccde/cc_approved.htm.
Arizona Debt Relief Programs
Arizona debt relief programs offer more than just the education offered through consumer credit counseling agencies. These programs seek to find a solution to overwhelming debt. For instance, they may offer settlement options by helping consumers negotiate with their creditors to settle the debt for less than what is owed.
Arizona consumers need to realize that most consumer debt relief programs provide services that the consumer can, in theory, do independently. The benefit of working with debt relief companies is the fact that the consumer gets expert help and a third-party negotiator. However, there is a charge for these services, and consumers need to know exactly what that charge is going to be before signing up for any debt relief programs.
Arizona Debt Collection Laws
When you have fallen behind on your debts, you will soon find creditors doing what they can to collect what is due them. After your account has been delinquent for a while, they may turn to debt collectors to try to reclaim what they are owed. If this occurs, you need to understand your rights when it comes to debt collection actions.
Arizona debt collection laws follow the Fair Debt Collection Practices Act, a federal law governing what debt collectors can and cannot do. Under this law, debt collectors cannot do the following:
• Call you at work or mail letters to your work unless you are unreachable at home
• Call in an attempt to harass
• Call before 8:00 a.m. and after 9:00 p.m.
• Contact any third party to tell them about your debt, ask them to help in their collection efforts beyond asking for contact information
• Contact you if you are being represented by a lawyer
If you wish the debt collector to stop contacting you, you must send a letter. At that point, the debt collector has the right to contact you only if a specific action is taking place. Any other contact is in violation of the Fair Debt Collection Practices Act.
In addition, the collections agency must disclose in their first contact with you their name, the name of the creditor, the date the account was turned over to them, the place debt was taken on, and any merchandise or service purchased with the money loaned to you.
Arizona debt collection law limits the interest rate a debt collection agency can charge to 10 percent. In Arizona, the statute of limitations on all types of debts is three years. This means that legal proceedings must be initiated within three years after consumers have become delinquent on their payments for a particular debt. Finally, Arizona debt collection laws protect 75 percent of earned but unpaid weekly earnings from being garnished to pay creditors.
If you feel a debt collector is violating these laws, contact the nearest Federal Trade Commission office or a local debt collection attorney for more help.
Arizona Mortgage Assistance Programs
The Arizona Department of Housing offers help for homeowners or those who wish to buy a home in Arizona but are struggling with debt. Those facing immediate foreclosure should look to housing counseling services offered through the Department of Housing. The Arizona Foreclosure Help Line is 877-448-1211. The department also maintains a list of homebuyer counseling agencies at http://new.azhousing.gov/ShowPage.aspx?ID=162.
Another option for those dealing with a mortgage they cannot pay is to seek help through the Making Home Affordable program. This program allows homeowners to refinance at a lower rate or a longer term to allow them to stay in their homes and avoid the cost and long-term repercussions of foreclosure.
Those interested in buying a home but dealing with bad credit due to past debt problems may wish to look into the FHA loan program. The FHA loan program has government backing, so credit ratings are less of a concern to banks when they look at a particular buyer.
Home buyers interested in living in rural areas of the state can get a mortgage with assistance through the USDA rural development program, provided they meet the income qualifications. This program provides direct and guaranteed loans to assist low to middle-income families buy or build homes in rural Arizona. For more information visit http://www.rurdev.usda.gov/az/RHousing.htm.
Arizona Government Assistance Options
Arizona does not offer any government assistance for debt, outside of mortgage programs and credit counseling recommendations. Companies advertising and stating that they can get government grants to assist with debt relief in Arizona are not being honest. However, low-income families may be able to get a better handle on their debt by applying for other types of assistance, such as assistance with utilities or food costs. This can free up money to use to pay down debt.
