6 Del. Admin. Code § 102-6.0

Current through Register Vol. 28, No. 5, November 1, 2024

Section 102-6.0 - 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 recordof 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 United States and Delaware or

6.4.5.2 limit or release the liability of any person for not performing the agreement or violating the law or

6.4.5.3 indemnify any person for liability arising under the agreement or the law.

6.5 If an individual residing in Delaware is referred by a licensee to another provider of debt management services, e.g. a referral by a credit counseling company to a debt settlement company, then it is the responsibility of the referring licensee to insure that such referral is made to a provider who is licensed or exempt from licensure in Delaware. If referrals are made though links on a licensee's web page, then the page must disclose if the referral is to a provider that is not authorized to provide services in Delaware.

6.6 If a provider uses a third party to solicit or qualify individuals for debt management services, any fee paid by the individual to the third party is an indirect charge attributed to the provider in calculating the fees or charges permitted by the provider under the Act.

6.7 Advertising must comply with the provisions is 6 Del.C. § 2430A and applies to any medium, e.g. print, broadcast, telecast, electronic, internet, or other.

6.7.1 "Easily comprehensible" as used in the § 2430A means that type must be large enough, and a video ad must be on the screen long enough, to be read by an individual of average eyesight. An audio ad must be spoken slowly enough to be understood by a person of average hearing.

6.7.2 A mere listing of the name, address, and phone number of a provider in a directory is not advertising under this section.

6 Del. Admin. Code § 102-6.0

11 DE Reg. 1062 (02/01/08)