Indiana Debt Consolidation
Debt Help in Indiana
Indiana residents who find themselves with more debt than they can handle have several options to consider. From approved debt counselors to mortgage assistance programs, the Indiana government offers a variety of programs to help struggling homeowners get back on track.
Indiana Credit Counseling and Debt Consolidation
One way to figure out how serious your debt situation might be is to contact a credit counseling agency. These agencies will set you up with a credit counselor who will show you how you can successfully get out of debt. Credit counselors usually help consumers set up a budget and a loan repayment plan. Most do not negotiate with creditors, but work only with the consumer.
Finding a trustworthy credit counseling agency can be a challenge, as many companies claim to offer these services when they, in fact, offer little help at all. While the federal government does not regulate credit counselors, nor does the Indiana state government, they do approve certain companies to work with bankruptcy cases. You can find a list of these companies at http://www.justice.gov. Using a credit counselor that is on this list gives you some added reassurance that you have found a reputable company.
One option to consider when dealing with debt is debt consolidation. A consolidation loan takes your existing debt and lumps it into one new loan. This typically is a loan with a lower interest rate than the other loans you have, which makes the minimum monthly payment lower as well. Keep in mind that debt consolidation can hurt your financial situation if you do not have the discipline necessary to avoid adding to your debt.
Indiana Debt Relief Programs
Indiana debt relief programs give consumers slightly more help, offering consumers the ability to negotiate with their creditors. While this is something most consumers can do on their own, some feel more confident when a third party intervenes. Debt relief companies in Indiana can help consumers negotiate debt settlements or lower repayment terms.
Be cautious when dealing with debt relief programs. While some may offer the help you need, the cost is often quite high. Learn about any fees before signing up for a program, and always ask what your money is used for if you are sending a payment. Avoid companies that take payments and apply them entirely to fees, rather than making a payment to your creditors.
Indiana Debt Collection Laws
Indiana follows the Fair Debt Collection Practices Act. This is a federal law that outlines how creditors can collect their debts. Under this law, certain actions are prohibited:
• Debt collectors may not call before 8:00 a.m. or after 9:00 p.m., nor can they call you at work if your employer says no.
• Collection agencies must send communication to your lawyer if you have one, rather than contacting you directly, if you tell them that you are working with a lawyer.
• Debt collectors my not harass, threaten, use profanity, or abuse you during any contact they have with you.
Collection agencies may contact you in person, over the phone, through the mail, via fax, or with a telegram. If they are having trouble reaching you, debt collectors may talk to your friends or family members to try to get contact information. They may not, however, disclose the fact that they are trying to collect a debt.
After contacting you, debt collectors have five days in which they must send a letter stating details about the debt and what you can do if you feel the debt is not actually yours. You have the right to stop the collections calls. Simply write to the collection agency telling them to stop contacting you. Because of the FDCPA, they must comply, and they may only contact you if something about your account changes. This does not mean anything has changed with your debt, however. You are still responsible for paying what you have borrowed.
If creditors wish to pursue legal action on debts that have become delinquent, they must do so within a certain time period. This law is known as the statue of limitations. In Indiana, the statute of limitations is as follows:
• Oral agreements – Six years
• Written contracts – Ten years
• Promissory notes – Ten years
• Open accounts (credit cards) – Six years
In addition to the laws outlined in the FDCPA, Indiana imposes a limit of eight percent on the amount of interest a collection agency can charge. The state also protects 75 percent of an individual’s weekly disposable earnings from garnishment.
Indiana Mortgage Assistance
The Indiana Housing and Community Development Authority offer assistance for consumers looking to buy a home or get out of mortgage problems. One of the best programs is the Market Stabilization Program, which offer assistance to homebuyers who are interested in purchasing foreclosed homes. Qualified buyers can receive as much as $15,000 in the form of a zero-interest second mortgage to be used as a down payment or to fix up the home. The IHCDA has several other programs to assist homebuyers, in particular first-time buyers, and this information can be found at www.in.gov/ihcda.
Those interested in buying a home with a tarnished credit score should talk to a HUD certified housing counselor. The Indiana housing counselors are listed at http://www.hud.gov. Often government backed loan programs, like the FHA loan, give these buyers the chance to realize the dream of homeownership.
Indiana’s government refers distressed homeowners to the state’s Foreclosure Prevention Network at 877-GET-HOPE. The free service is available from 8:00 a.m. until 8:00 p.m. Sometimes the counselors offer help over the phone. For homeowners who are in deep financial trouble, the Foreclosure Prevention Network will recommend a certified foreclosure intervention specialist.
Indiana Government Assistance Programs
Indiana does not offer its residents any program guaranteed to get them out of debt. For the most part, Indiana offers mortgage assistance and approved credit counselors. Some state aid programs that minimize financial pressures can also free up money to pay down debt. Those struggling should look into these options to see if they can lessen the strain on their budget as they work their way out of debt.
