Buckeye Institute research fellow Greg Lawson appeared in front of the Ohio House Financial Institutions Committee Tuesday to support a proposed bill that could help Ohioans be able to resolve their unresolved debt easier.
“Ohio’s arbitrary fee caps and poorly tailored law makes it harder for some debt settlement firms to operate here; which, in turn, makes it harder for many of your constituents to reduce and settle their outstanding debts,” Lawson said Tuesday to the Committee about House Bill 131.
Lawson thinks the bill’s policies will help clarify the legal rules for debt settlement companies, which will help Ohioans to manage their debt.
The research fellow noted people in Ohio have an average of $5,583 in credit card debt more than 10 percent of the median household income. He described the difficulties this debt can have on people in an Akron Beacon Journal op-ed:
“Ohioans already suffer under the burdens of regulation and occupational licensing restrictions. Those burdens limit job opportunities, impede career advancement, and can even add to the debts that debt settlement firms help to resolve. Reducing, restructuring and retiring old debts are hard enough for most people. Renaming debt settlement services as the “unauthorized practice of law” will only make it harder.”
Opponents of House Bill 131 have called this legislation as “unauthorized practice of law,” according to Lawson. Lawson believes these critics wrongly argue that the General Assembly must protect Ohio from debt settlement companies.
“Federal regulations already require debt settlement companies to disclose to clients the costs, benefits, and risks associated with debt settlement programs; and prevent settlement companies from charging their clients until they accept a settlement with a creditor and start paying off at least a portion of their debt,” he said.
Lawson closed his remarks by pointing out how Ohio already regulates the industry above and beyond the federal rules, and reiterated this bill will help clarify these laws and help both debt settlement companies and Ohioans.
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