The simple answer to this complex question is … YES. Debt negotiation is a legal solution, used by thousands of North Americans to avoid having to declare bankruptcy. The theory behind debt negotiation is very simple: negotiate agreements with financial institutions, which benefits both parties. This leads to the bank receives a single payment in the amount agreed to settle the debt and the consumer pays the entire debt for a smaller percentage than it should. But the biggest advantage of debt negotiation is to avoid future problems with the payments because the debt is canceled in its entirety. In no time the consumer is breaking the law or committing illegal acts.

So if the answer is so simple because the question seems so complicated? The problem really in debt negotiation is that the practice is illegal because it is completely legal, the problem lies in the ethics of its practitioners. Unfortunately, some debt negotiation companies have no ethics and profit from the wrong time by the person's happening to their advantage. What they do essentially is that the person they promise unrealistic results and then charge a lot of money for work they never did. Therefore it is important to note that the legislation was not so much to protect debt negotiating companies but for consumers who are unaware of the regulations. It is for this reason that these companies are required to complete forms and comply with laws in order to have more control over them. This helps the government to identify which companies are unethical in an industry that must be ethical and legal.

The idea is that companies that do not meet the requirements disappear. So if you want to join a company to negotiate your debt, stay calm because what we're doing is ethically and morally right, just make sure that the company will also choose to be. Scott Wallitsch is IAPDA Certified Debt Negotiator for as DebtorSolution. He provides advice on and () to persons are seeking to become financially and economically independent.