Debt management services Clause Samples
The 'Debt management services' clause defines the scope and terms under which a party provides assistance in managing, negotiating, or restructuring another party's debts. Typically, this clause outlines the specific services offered, such as creating repayment plans, negotiating with creditors, or providing financial counseling, and may set out any fees, obligations, or limitations associated with these services. Its core practical function is to clarify the responsibilities and expectations of both parties, ensuring transparency and reducing the risk of misunderstandings regarding the management of outstanding debts.
Debt management services. Debt management services" means the provision of any services whereby a debt management services provider assists in managing the financial affairs of a debtor by distributing periodic payments to the debtor's creditors from funds that the debt management services provider receives from the debtor and where the primary purpose of the services is to effect full repayment of debt incurred primarily for personal, family, or household services. Any person so engaged or holding out as so engaged is deemed to be engaged in the provision of debt management services regardless of whether or not a fee is charged for such services.
Debt management services. Debt management services" means the provision of any one or more of the following services in connection with debt incurred primarily for personal, family, or household services:
(1) managing the financial affairs of an individual by distributing income or money to the individual's creditors;
(2) receiving funds for the purpose of distributing the funds among creditors in payment or partial payment of obligations of a debtor; or
(3) adjusting, prorating, pooling, or liquidating the indebtedness of a debtor. Any person so engaged or holding out as so engaged is deemed to be engaged in the provision of debt management services regardless of whether or not a fee is charged for such services.
Debt management services. 6.1 Before entering into an agreement for debt management services, a licensee must provide an itemized list of goods and services and disclose all fees as required under 6 Del.C. §2417A.
6.1.1 The list must be clear and conspicuous.
6.1.2 The list must be provided in a record the consumer may retain regardless of whether an agreement is reached for services.
6.2 No debt management services may be furnished until a certified counselor conducts the education and financial analysis required, and prepare a suitable plan if appropriate, as provided in 2417A(a) and the consumer is
6.2.1 given a copy of the financial analysis and plan.
6.2.2 informed in a record of the availability, at the consumer's option, of assistance by toll-free communication or in person to discuss the financial analysis.
6.2.3 informed that some of the creditors, identified by the individual or known by the provider to be creditors of the individuals, may be unwilling to negotiate with the provider.
6.2.4 given the separate disclosures required under 6 Del.C. §2417A(d).
6.3 A plan or program is suitable under 6 Del.C. §2417A(b)(3)(B) when, at a minimum, the provider determines:
6.3.1 for a plan that provides for payment of principal in full, that the individual has the ability to repay the debt but only after there are concessions by creditors.
6.3.2 for a program that contemplates settling the debts of an individual for less than the principal amount owed, that the individual does not have the ability to satisfy creditors out of current income in a reasonable time even if the creditors made concessions other that reduction of principal.
6.4 Agreements must include the provisions required under 6 Del.C. §2419A.
6.4.1 Agreements must be accompanied by the "Notice of Right to Cancel" in bold-face type surrounded by bold black line as required under 6 Del.C. §2420A.
6.4.2 Any agreement that does not comply with the law or rules is voidable.
6.4.3 Agreements may be terminated as provided in 6 Del.C. §2426A.
6.4.4 In a plan that provides for regular payments to creditors, the concessions that the provider believes may be offered by each creditor must be identified in the agreement. The concessions may include reduction in finance charge or interest, reduction or waiver of charges for late payment, default or delinquency. Concessions may also include more favorable terms on a judgment.
6.4.5 An agreement may not:
6.4.5.1 provide for the application of the law of a jurisdiction other that the U...