North Carolina Debt Consolidation
Debt Help in North Carolina
North Carolina residents struggling with debt problems have several resources they can turn to. While the state does not offer a “get out of debt free” card, it does offer a variety of programs designed to help consumers learn to manage and pay off damaging debt.
North Carolina Credit Counseling and Debt Consolidation
For some struggling with debt, a little education and accountability is all that is needed to help them get back on track. This is what credit-counseling firms offer. Credit counselors provide mentoring, support, budget education, and overall money advice, all of which focus on helping an individual work his or her way out of debt.
While this sounds ideal, and in some situations it is, you do need to realize that you will pay for these services. You also need to know that some companies parade themselves as credit counseling firms, but offer little real help to those who send money their way.
One way to ensure that you are getting quality help is to choose a company that has government approval. The Federal Courts, for instance, approve certain companies to serve as credit counselors to those headed to bankruptcy court. Choosing one of these companies helps you feel secure in the firm you use. You can find a list of the different North Carolina credit counselors approved for bankruptcy cases at this link: http://www.uscourts.gov.
You also may want to consider debt consolidation. To consolidate your debts, find a debt option, such as a home equity loan or personal loan through your current bank, that allows you to pay off all of your debts and turn them into one loan product with a lower interest rate than what you are currently paying. If you choose this route as a debt help solution, make sure that you are disciplined enough to stop adding to that debt once it is repaid.
North Carolina Debt Relief Programs
If you find that counseling and support is not sufficient help for your debt problem, consider contacting a North Carolina debt relief firm. These companies offer additional help by proactively negotiating with your creditors on your behalf. Sometimes this ends in a better term for your debt, and other times it ends with a debt settlement. Proceed with caution with these services, however, because they often have a high price, and sometimes the amount you pay far outweighs potential savings.
North Carolina Debt Collection Laws
North Carolina’s debt collection laws closely resemble the laws under the Fair Debt Collection Practices Act. Both offer the following protections for consumers facing calls form a debt collector:
- Debt collectors may not call at inconvenient times or call repeatedly with the intent to annoy.
- Debt collectors may not harass or threaten debtors.
- Debt collectors must be truthful and may not intentionally mislead.
- Debt collectors must identify themselves and their employers.
- No correspondence regarding the debt can make it obvious that you owe a debt. For instance, letters must not state anything on the outside of the envelope that states you owe a debt.
- Debt collectors may not call you at work if your employer doesn’t allow this.
- Debt collectors must contact your attorney, rather than you, if you have one.
- If you dispute the debt, you must state this within 30 days of initial contact. Your first letter from the debt collector must explain this.
- Debt collectors may not use profane or offensive language.
- Debt collectors may contact third parties, but they may only do so once and they may not disclose any information about your debt. The only reason they may contact third parties is to look for contact information for you.
You have the right to stop the calls from a collection agency under the laws of the FDCPA. To do this, simply contact the collection agency, in writing, asking them to stop calling or writing. They will then send a letter indicating their intent to stop. If they contact you again, it can only be to inform you that something is changing about your account.
Your creditors have the right to sue you if you are not paying what you owe. However, in order to do so, they must begin the legal proceedings within a time frame called the statute of limitations. Under North Carolina law, all types of debt have a statute of limitations of three years, with the exception of promissory notes, which have a statute of limitations of five years.
North Carolina Mortgage Assistance Programs
The North Carolina Housing Finance Agency offers a variety of programs to help people buy a home. For first-time buyers, the Agency offers a mortgage with a competitive interest rate, with the potential for up to $8,000 in down payment assistance. The primary venue this is offered through is the FirstHome Mortgage, which is a 30-year fixed mortgage with the potential of a 0 to 3.5 percent down payment. You may qualify for this program if you have formerly owned a home but have not owned a home within the past three years, or if you are buying in an economically distressed area.
Some first time homebuyers participating in the FirstHome Mortgage program may qualify for the Mortgage Credit Certificate, a federal tax credit designed for moderate to low-income homebuyers. The tax credit allows qualified borrowers to claim some of their mortgage interest on their federal income tax return.
Buyers who would like to get a home but have a poor credit score will find that the FHA loan program or another government-backed loan, like the USDA loan, provides the best option. These loans rely less strongly on credit scores because of the government backing.
If you are struggling with paying your mortgage, the NCHFA offers guidance about foreclosure at http://www.nchfa.com. Above all, the Agency warns consumers against working with companies that charge a fee to help them through foreclosure. You can also get help through the HOPE for Homeowners program, which may allow you to refinance into a new mortgage that you can actually afford. Learn more about this program at http://www.nchfa.com.
North Carolina Debt Assistance Programs
Outside of these programs, North Carolina does not offer any debt assistance. Just as it took time to get into debt, it will take time to get out of it, but it is a journey well worth taking!