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How to Get Debt Relief in North Dakota

Dena Standley | July 25, 2023

Dena Standley
Legal Expert, Paralegal
Dena Standley, BA

Dena Standley is a seasoned paralegal with more than 20 years of experience in legal research and writing, having received a certification as a Legal Assistant/Paralegal from Southern Technical College.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: If you're struggling with debt in North Dakota, SoloSuit can help you find the relief you need.

Are you drowning in debt and wondering what to do about it? You are not alone; most North Dakotans have two or more debts to pay. Some manage to make their payments, while others struggle due to challenges such as unplanned medical bills, job loss, the death of a provider, or life-changing financial events. Others may have had a challenge with budgeting and realized, too late, that they were spending more than they had earned.

Generally, North Dakota has minimal personal debt levels in the country and records fewer delinquent mortgages and debts in collection. This positive outlook does not mean the residents do not face overwhelming debt challenges. In fact, North Dakotans have a 33.28% credit utilization ratio, 3.28% above the recommended value.The utilization ratio is how much credit you have available vs. how much you have used. Most experts recommend keeping it below 30%.

The table below further breaks down the credit card situation.

North Dakota Credit Card Stats

Average credit limit $15,365
Average debt per household $8,450
Average number of cards 2.9
Delinquent accounts 5.1%
Average credit score 697
Popular credit card Cashback rewards
Source: Experien, Credit Sesame, and ValuePenguin

North Dakotans have multiple credit counseling and debt management agencies that provide free or low-cost assistance to residents struggling with debt. Today, we will discuss two main debt-relief options these companies provide as part of their services. But before we dive into it, let us briefly look at debt relief scams.

Debt relief scams

Being in debt can be frustrating, and you could easily fall prey to scammers who promise to make it go away within a short time. Always be on the alert for any person claiming to be a debt relief agent who:

  • Refuses to give you their details and doesn't want to sign a contract
  • Requests you to make a down payment before they provide any services
  • Pressures you to make a decision quickly

North Dakota tries to protect their residents by laying out requirements regarding fees. For example, debt relief companies can ask for a maximum $50 origination fee. Secondly, they can take up to 15% as partial payment for their services and the rest paid to the creditors within 45 days. The North Dakota Department of Financial Institutions offers more information on debt relief laws.

Settling debt as a debt-relief option

A consumer uses the debt settlement option if they cannot pay the outstanding debt, even if they cut back on most expenses. North Dakota residents often try this option before filing for bankruptcy. You can approach the creditors on your own or hire a debt settlement company.

Reputable debt settlement companies have a good standing with creditors or debt collection agencies, and they can negotiate a better deal. Even though debt settlement companies charge a fee, you can still end up saving a lot of money if they can help you reach a settlement of a percentage of the debt you owe. The following is the debt settlement process you will go through if you choose to work with a debt settlement company:

  1. In your initial session, you will explain your financial situation to the settlement officer.
  2. The debt settlement company may advise you to stop making payments but redirect the funds to a savings account that they will direct you to open.
  3. Once you make several deposits, the debt settlement company will contact the creditors to negotiate better payment terms.
  4. If they get a good deal, the debt settlement company keeps part of the money as fees and gives the rest to the creditor.

Not all creditors will respond positively and reduce the debt. Others may forward your debt to collection agencies known to follow their money aggressively. Some creditors take it a notch higher and sue you.

If you receive a lawsuit letter from a creditor or debt collection agency, SoloSuit can help you send an Answer. You must send this document to the creditors within 14–30 days, or they will receive a default judgment. Learn more about how to respond to a debt lawsuit in this video:

Debt management in North Dakota

Debt management involves coming up with a plan to pay off all your debt and contacting your creditors to develop an agreement that you can manage. North Dakotans who use this method have a steady income and can afford to make small payments each month. Debt management is not the best option for you if you have overwhelming debt and cannot afford the necessities.

Before starting the process, you have to decide whether you are using the do-it-yourself approach or working with a credit counseling company. If you choose the latter, you will be making a single payment to the company, and they will distribute the funds to the creditors.

For-profit credit counseling companies will try to cover their fees by negotiating lower interest rates, while a non-profit will pass the entire lowered rate to you. Credit counselors will take you through the following process after booking a session. They will:

  1. Help you find out why you are in deep debt
  2. Assist you in developing an affordable monthly household budget that cuts back on expenses
  3. Request your credit report to ensure they have all the balances right
  4. Offer you a debt relief recommendation based on the overall findings
  5. Ask you to close all credit card accounts or remain with one for emergencies
  6. Require you to sign up and start the debt relief program

Debt management plan can only cover the unsecured debt, meaning that debts guaranteed against your property or assets do not qualify.

Utilize these North Dakota debt relief programs

As a North Dakota resident, you may be entitled to state-specific help. Check out these North Dakota debt relief programs to see if you qualify:

How SoloSuit can help

Debt collectors can push you to look for debt-relief options because of their harassing calls and emails. Before you settle on a debt-relief plan, SoloSuit can help you respond to debt collectors with a variety of legal documents that will help you protect your rights and present the strongest case, both in and out of court. Check out our document calculator below to determine which route is best for you and your situation.

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