History in the making: SAFTI in Debt Relief Industry

One year ago the Federal government sent Earthquake reverberations throughout the debt relief industry with a FTC ruling stating how this industry had to do business with US consumers. The most sweeping change stated that debt settlement companies now have to charge consumers their fee after a debt was settled. This resulting action forced many changes as this affected many areas of the companies’ operations. (see pie chart) Many companies had to layoff employees and even some companies decided to go out of business altogether. Then came enforcement of not only Federal regulations but also state regulations which created concerns in the industry on how to educate all the debt relief industry workers on the new ways of doing things. But exactly a year after the Government mandated change came a remedial action from within the industry, a self policing Initiative called the State and Federal Transparency Initiative (SAFTI)

"The best way to tackle the existing problems with the debt relief industry is through an undertaking like SAFTI,” said Laurence Larose, Executive Director IAPDA. “Industry players need to come together and strongly promote self regulation by supporting SAFTI, and I hope they do. The debt industry needs to move forward after a year of cleansing and re-grouping. The time to stop finger pointing and do what it takes to grow is now. Consumers are the top priority moving forward and they deserve the very best with debt relief services and they need a third party industry group to look to that they can trust, SAFTI provides this."

As history was made in the debt relief industry on October 27, 2010, history is being made exactly a year later on October 27th, 2011 where SAFTI will officially "GO LIVE". The system is FREE to join and applications are currently being accepted. The following industries will be involved: Debt Settlement/Resolution, Tax Resolution, Credit Repair and Debt Management and the myriad of vendors to the debt relief industry, especially the lead generation companies. (see chart)

“For the first time in our industry's history, this system will provide a completely transparent, self regulation system for the debt relief industry,” said Matt Hearns author of this bold initiative, “Consumers are once again spending away and leveraging their credit. We are at the top of a new cyclical wave of consumer debt. Since the October 27, 2010 action, many bad companies have gone out of business or left the space. Unfortunately so have many good ones. To add insult to injury, the debt relief space is sadly in the same state it was prior to the changes. We need a self regulation tool in place to show the consumers and the regulators that we can create a safe industry.”

Debt Relief professionals are invited to learn more by visiting.
SAFTI Network

Sources: The International Association of Professional Debt Arbitrators, providers of nationally-recognized debt relief certification programs.

Debt Relief Industry News: Issue One Vol 1

Welcome to the premier issue of Debt Relief Industry News. Dedicated to sharing informative articles about the debt relief industry with a positive and constructive approach.

As the saying goes, "the only constant in life is change" and nothing facilitates change in an industry more then government regulation. Last October the Federal Trade Commission initiated a new ruling known as the TSR rule that affected how debt settlement companies could conduct their business with consumers. Considered one of the most profound changes was how they could collect their fees from their consumer clients. Now debt settlement companies had to collect the fee after a debt had been settled and not beforehand as many had done previously before the ruling. In addition to the change brought about by the Federal government there are many new state regulations that these debt relief companies had to consider in their dealings with consumers.

"The debt relief industry has always been evolving", said, Laurence Laros of the International Association of Professional Debt Arbitrators (IAPDA). He continues "The industry is also evolving by polarizing into a new debt relief industry which embraces both debt settlement and consumer credit counseling services. The Evolution 2011 conference embraces this development. The future of the debt relief industry is very bright for those willing to face the challenges of learning all options for debt relief available to consumers and fully advising consumer clients on all of their options while operating an efficient company with low overheads. The FTC TSR rule amendment has been in effect for 9 months now and well managed debt relief companies are starting to reap the rewards of their good work with cash flows from fees returning. We are seeing new companies starting and existing companies growing again."


To understand the changes to the debt relief industry it is important to understand the dynamics resulting from the changes. Vendors of debt relief software had to make application modifications, training and certification companies had to rewrite their training manuals, lead generation companies had to rewrite their scripts and websites, new approaches to the negotiation process, a rescue operation by thriving compliant debt settlement companies for consumers whose previous companies were forced to go out of business and then finally a host of new products and services to consider.

In subsequent issues we will look at these change in a non-biased and objective view. The purpose is to create a sense of urgency for unity within the debt relief industry. In future issues you will be able to read about reviews of new products and services, interviews with industry leaders, polls indicating opinions from debt relief professionals, and resources where one can go for more information. Become a follower of this blog and don't miss a single issue. And remember your comments are always welcome.

-RKO
Publisher and Author
A1A Computer Professionals, Inc
(all rights reserved)