1.    Before the consumer signs a contract, the debt-settlement provider shall provide an oral and written notice to the consumer that clearly and conspicuously discloses all of the following:

Terms Used In North Dakota Code 13-11-17

  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Contract: A legal written agreement that becomes binding when signed.
  • Credit Score: A number, roughly between 300 and 800, that measures an individual's credit worthiness. The most well-known type of credit score is the FICO score. This score represents the answer from a mathematical formula that assigns numerical values to various pieces of information in your credit report. Source: OCC
  • following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
  • Garnishment: Generally, garnishment is a court proceeding in which a creditor asks a court to order a third party who owes money to the debtor or otherwise holds assets belonging to the debtor to turn over to the creditor any of the debtor
  • Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
  • Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
  • Property: includes property, real and personal. See North Dakota Code 1-01-49
  • Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
  • written: include "typewriting" and "typewritten" and "printing" and "printed" except in the case of signatures and when the words are used by way of contrast to typewriting and printing. See North Dakota Code 1-01-37

a.    Debt-settlement services may not be suitable for all consumers.

b.    Using a debt-settlement service likely will harm the consumer’s credit history and credit score.

c.    Using a debt-settlement service does not stop creditor collection activity, including creditor lawsuits and garnishments.

d.    Not all creditors may accept a reduction in the balance, interest rate, or fees a consumer owes.

e.    The consumer should inquire about other means of dealing with debt, including nonprofit credit counseling and bankruptcy.

f.    The consumer remains obligated to make periodic or scheduled payments to creditors while participating in a debt-settlement plan, and that the debt-settlement provider will not make any periodic or scheduled payments to creditors on behalf of the consumer.

g.    The failure to make periodic or scheduled payments to a creditor is likely to: (1) Harm the consumer’s credit history, credit rating, or credit score; (2) Lead the creditor to increase lawful collection activity, including litigation, garnishment of the consumer’s wages, and judgment liens on the consumer’s property; and

(3) Lead to the imposition by the creditor of interest charges, late fees, and other penalty fees, increasing the principal amount of the debt.

h.    The amount of time estimated to be necessary to achieve the represented results.

i.    The estimated amount of money or the percentage of debt the consumer must accumulate before a settlement offer will be made to each of the consumer’s creditors.

j.    A statement indicating that debt-settlement providers are licensed and regulated by the North Dakota department of financial institutions and any complaints regarding the services of a debt-settlement provider should be directed to the North Dakota department of financial institutions, Bismarck, North Dakota.

2.    The consumer shall sign and date an acknowledgment form entitled “Consumer Notice and Rights Form” that states: “I, the debtor, have received from the debt-settlement provider a copy of the form entitled ‘Consumer Notice and Rights Form’.” The debt- settlement provider or its representative also shall sign and date the acknowledgment form, which includes the name and address of the debt-settlement services provider. The acknowledgment form must be in duplicate and incorporated into the “Consumer Notice and Rights Form”. The original acknowledgment form must be retained by the debt-settlement provider, and the duplicate copy must be retained within the form by the consumer. If the acknowledgment form is in electronic form, then the acknowledgment form must contain the consumer disclosures required by section 101(c) of the federal Electronic Signatures in Global and National Commerce Act [15 U.S.C. § 7001(c)].

3.    The requirements of this section are satisfied if the provider provides the following warning verbatim, both orally and in writing, with the caption “CONSUMER NOTICE    AND RIGHTS FORM” in at least twenty-eight-point font and the remaining portion in at least fourteen-point font to a consumer before the consumer signs a contract for the debt-settlement provider’s services:

“CONSUMER NOTICE AND RIGHTS FORM CAUTION We CANNOT GUARANTEE that you successfully will reduce or eliminate your debt. If you stop paying your creditors, there is a strong likelihood some or all of the following may happen:

–     CREDITORS MAY STILL CONTACT YOU AND TRY TO COLLECT.

–     CREDITORS MAY STILL SUE YOU FOR THE MONEY YOU OWE.

–     YOUR WAGES OR BANK ACCOUNTS STILL MAY BE GARNISHED.

–     YOUR CREDIT RATING AND CREDIT SCORE LIKELY WILL BE HARMED.

–     NOT ALL CREDITORS MAY AGREE TO ACCEPT A BALANCE REDUCTION.

–     YOU SHOULD CONSIDER ALL YOUR OPTIONS FOR ADDRESSING YOUR DEBT, SUCH AS CREDIT COUNSELING AND BANKRUPTCY FILING.

–     THE AMOUNT OF MONEY YOU OWE MAY INCREASE DUE TO CREDITOR IMPOSITION OF INTEREST CHARGES, LATE FEES, AND OTHER PENALTY FEES.

–     EVEN IF WE DO SETTLE YOUR DEBT, YOU MAY STILL BE REQUIRED TO PAY TAXES ON THE AMOUNT FORGIVEN.

YOUR RIGHT TO CANCEL If you sign a contract with a debt-settlement provider, you have the right to cancel at any time and receive a full refund of all unearned fees you have paid to the provider and all funds placed in your settlement fund that have not been paid to any creditors.

IF YOU ARE DISSATISFIED OR YOU HAVE QUESTIONS If you are dissatisfied with a debt-settlement provider or have any questions, please bring it to the attention of the North Dakota Department of Financial Institutions, Bismarck, North Dakota.

I, the debtor, have received from the debt-settlement provider a copy of the form entitled Consumer Notice and Rights Form.

Signed:                                                        Printed name:                                             ”

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