In past few years, economy has seen many ups and downs but most severe downturn was the economic recession that occurred last year.
In this recession period, many companies fired their employees and wages of many employees were reduced.
To run their business, companies had to do this.
They also increased prices of their products due to these financial crisis and those people had to suffer who had low wages or who were running small businesses.
At that time, there were many people who were using credit cards to pay their bills but they did not know that they will not be able to pay the debt back.
Once this situation of financial instability reached to its peak, these people had not other option than to file for the bankruptcy.
Many people did this and creditors suffered with a great loss.
Debtors ruined their future.
Government had to take appropriate steps in order to take control of this situation and to stop people from filing for bankruptcy.
Government of United States devised new laws.
According to these laws, government helped out debtors by disallowing settlement companies to take any upfront fees.
People did not use negotiation process because there were many shady companies working in market.
These companies were doing fraud business.
Nobody had extra amount to waste with these companies, so they preferred filing for bankruptcy over settlement.
Government had to do something because although the bankruptcy is a quick way to get out of trouble but it's after effects are really bad.
So, government made amendments in previous rules of bankruptcy and made it more complex process so that people should stay away from it.
On other hand, when upfront fees were lifted, people were ready to negotiate.
Now, creditor took a sigh of relief because they had already suffered enough.
Now, it was time to take their investment back.
Even if they do not get much interest over the loan but still something is better than nothing.
It is very good option for debtors because it has very little effect on customer's future life.
A legal adviser can inform people more about the benefits of these laws so try to find a proper legitimate firm.
In this recession period, many companies fired their employees and wages of many employees were reduced.
To run their business, companies had to do this.
They also increased prices of their products due to these financial crisis and those people had to suffer who had low wages or who were running small businesses.
At that time, there were many people who were using credit cards to pay their bills but they did not know that they will not be able to pay the debt back.
Once this situation of financial instability reached to its peak, these people had not other option than to file for the bankruptcy.
Many people did this and creditors suffered with a great loss.
Debtors ruined their future.
Government had to take appropriate steps in order to take control of this situation and to stop people from filing for bankruptcy.
Government of United States devised new laws.
According to these laws, government helped out debtors by disallowing settlement companies to take any upfront fees.
People did not use negotiation process because there were many shady companies working in market.
These companies were doing fraud business.
Nobody had extra amount to waste with these companies, so they preferred filing for bankruptcy over settlement.
Government had to do something because although the bankruptcy is a quick way to get out of trouble but it's after effects are really bad.
So, government made amendments in previous rules of bankruptcy and made it more complex process so that people should stay away from it.
On other hand, when upfront fees were lifted, people were ready to negotiate.
Now, creditor took a sigh of relief because they had already suffered enough.
Now, it was time to take their investment back.
Even if they do not get much interest over the loan but still something is better than nothing.
It is very good option for debtors because it has very little effect on customer's future life.
A legal adviser can inform people more about the benefits of these laws so try to find a proper legitimate firm.