Residents of Maryland have learned a few things about the battle to build wealth. For one, they have learned that when you want to build wealth, having a plan to pay off debt is often the first step. Maryland is wealthier than other states by comparison, but that doesn’t mean the state’s residents are immune from consumer debt. For many, the answer to getting from under a major cloud of debt revolves around the utilization of debt relief methods. Debt settlement and consolidation are both excellent options available to people struggling with a mountain of credit card bills. If you’re in Maryland and want to get out of debt so you can start building real wealth, here’s some information that might help.
Maryland debt settlement laws and regulations
In 2011, Maryland passed a comprehensive law to regulate the behavior of debt settlement companies. The state wanted to ensure that companies were working for the benefit of consumers, and more, that debt settlement companies were being observed on a yearly basis. Under the law, all debt settlement companies are required to register with the Commissioner of Financial Regulation. In addition to that, debt settlement companies can only operate if they are working with creditors to reduce the overall principal consumer owe on a debt. The law also mandated that debt settlement companies can take no more than six payments to settle a debt.
Maryland also regulates the way in which debt settlement companies must manage their money. These companies must hold money in separate bank accounts to ensure that customer debts are paid off. The idea behind the new regulation is to make sure that when customers commit to a debt settlement program, they are rewarded for their diligence.
Economics in the state of Maryland
Proximity to Washington has long driven a strong economy in Maryland. Given the number of federal government jobs available throughout the region, Maryland has long supported upper middle class communities where people are able to live well. The unemployment rate of just more than five-percent is slightly higher than the national average. However, the jobs people do hold tend to pay well. With a median household income of just less than $70,000, Maryland is actually the richest state in the entire country.
Though the general outlook for Maryland seems to be strong on a yearly basis, there is also reason to be concerned about the gap between the rich and the poor. Maryland has many rich communities, like the posh Bethesda area outside of Washington. It also has poorer areas. In Baltimore, where the unemployment rate is still above seven-percent, there are many neighborhoods where families live in poverty. Maryland in general has a poverty rate of right at 10-percent, which falls below the national average. Baltimore, on the other hand, has a high poverty rate at just north of 23-percent. One can see in this dichotomy the staggering inequality that exists in pockets of the state.
How debt settlement can help Maryland residents
There are many benefits to debt settlement for those who qualify. For one, it can reduce the principal a person has to pay. Debt settlement allows people to knock out debt with one punch rather than trying to chip away at it over time. It also allows people to get back on track with rebuilding their credit. A settled debt will be listed on a person’s credit report, and while having to settle debt is not a good thing, it’s better than allowing debt to languish in default. It starts the clock toward good credit for those who want to move on.
Prime candidates for debt settlement
People who have old debts that have fallen into serious delinquency or defaults are excellent candidates to settle their debt. In order to settle a debt, though, you will usually have to come up with a significant sum of money. The more you can pay on the spot, the bigger discount you will get on the principal of the loan. People who have the means to eliminate debt through a large lump sum payment are prime candidates, though arrangements can be worked out with many different kinds of consumers.
Debt settlement is typically only available on certain types of unsecured loans, including credit cards, medical debt, and personal loans. In addition, debt settlement programs are usually only offered to those who have a large debt burden. The bulk of debt settlement options are available to people who have fallen behind on their loan payments or have demonstrated other forms of financial hardship in attempting to pay down the loan over time. Ultimately it is best to consult with a professional to determine whether your situation is eligible and ideal for debt settlement.