Arkansas Debt Consolidation



Debt Help in Arkansas

Whether you got into debt trouble due to poor financial choices or simply because of unforeseen circumstances, when you reach the point where you realistically cannot pay what you owe, state debt relief programs in Arkansas may help. Research all of your options as you work on finding a resolution to your debt, and do not be afraid to look at state based help.

Arkansas Debt Consolidation and Credit Counseling

The Arkansas attorney general recommends starting with credit counseling services before debtors pursue any other form of Arkansas debt relief. Credit counseling works with consumers to teach them about debt and the best possible ways to manage it. Most credit counseling companies do not offer debt relief solutions, but rather help consumers learn how to manage their money, work with creditors, and get their debt paid off on their own.

The best way to ensure that you are working with a quality credit counseling agency is to choose one that is approved by the federal government to work with bankruptcy cases. Even if you do not intend to file bankruptcy, using an approved credit counselor gives you the confidence that the company offers quality services. You can find a list of the approved Arkansas credit counseling companies at http://www.justice.gov/ust/eo/bapcpa/ccde/CC_Files/CC_Approved_Agencies_HTML/cc_arkansas/cc_arkansas.htm.

Debt consolidation provides another option for dealing with debt, and it may be the option recommended by credit counselors. A debt consolidation plan takes all debt and pays it off using one low-interest loan. The goal is to allow the debtor to pay down the debt more effectively by lowering the interest rate or making the monthly payment amount less. For those who cannot make their monthly payments, this can be an effective way to deal with debt. The key is to stop adding to the debt once the consolidation loan is in place.

Arkansas Debt Relief Programs

Most Arkansas debt relief programs take debt relief a step further by communicating with the creditors on behalf of the debtor. Often, the result is a debt settlement, or a situation wherein the creditor accepts less money as payment in full for the debt.

Arkansas debt relief programs can be incredibly helpful in negotiating with your creditors, because these professionals have extensive experience in this light. However, not all companies who pose as debt relief companies are legitimate, and some that are legitimate are a bit predatory with their fee structures. Always learn what the fees are upfront. If you are asked to send any money, make sure you know what it is for. Sometimes companies will request a payment that you think is going toward your debt, when in reality it is paying the debt relief company. Also, remember that you can do much of what debt relief companies do on your own, if you are willing to call your creditors and negotiate on your own behalf.

Arkansas Debt Collection Laws

Arkansas debt collection laws protect you from harassing behavior on the part of those trying to collect what you owe. Debt collection laws limit the way that a debt collector can contact you as the consumer. Debt collectors may not use harassing language, threaten, intimidate, or embarrass you. They also must not call before 8 in the morning and after 9 at night. Debt collectors cannot call you at the job if this is prohibited by your employer and the debt collector knows of the policy.

If you feel that you do not wish to have any more contact with the debt collector, inform them of this fact in writing. The only time a debt collector can contact you after receiving this information is to notify you that a certain action will be taken in regards to your account.

Debt collectors must be truthful and may not intentionally mislead you. For example, they cannot make you think they are with the government or threaten to take you to jail.

If you feel that a debt collector is in violation of these laws, keep detailed records of any communication you have. Record the time, date, and name of the person you talked to, and keep copies of all written communication you have with the debt collector. Then, report the company to the following address:

Arkansas Debt Collection Board
523 S. Louisiana, Suite 460
Little Rock, AR 72201

In addition to these debt collection practices laws, Arkansas limits the amount of interest a collection agency can charge to six percent. Also, 100 percent of your wages are protected for 60 days. If your creditors decide to pursue legal action against you, they must do so within the time period outlined in the statute of limitations. In Arkansas, the statute of limitations is as follows:

• Open accounts (like credit cards) – Three years
• Oral agreements – Three years
• Written contracts – Six years
• Promissory notes – Six years

The statute of limitations means that your creditors must pursue legal action within that time frame if you become delinquent on your accounts. The time starts when the account first becomes delinquent.

Arkansas Mortgage Assistance Programs

Whether you have bad credit and want to buy a home or are struggling to keep the home you already have due to debt, a variety of federal and state mortgage assistance programs can help. For homeowners facing foreclosure, the Keep Home Affordable program can assist them in refinancing their home with more affordable terms.

Arkansas also offers the Down Payment Assistance Program through the Arkansas Developmental Finance Authority. This program offers $1,000 to$6,000 for closing cost assistance to qualified applicants in the form of a second mortgage.

If your problem is a poor credit score, look into government backed loan programs, such as the FHA loan. These do not rely as heavily on your credit rating as other loan options, because they have government backing. While you cannot have horrible credit and get one of these loans, a few marks on your credit score will not prevent you from owning a home with help from the FHA.

Arkansas Government Assistance Options

Outside of government-approved credit counseling services, homebuyers programs with state backing, and debt protection laws, Arkansas does not offer much in the way of debt assistance. However, for low-income families, the state’s other assistance programs can provide a means to free up some money to use toward debt repayment.

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