Why choose debt consolidation? Don’t! End of story right? No, I would like to know why. Fair enough. However, did you know that most of the debt consolidation companies are actually owned by the credit card companies? Not debt settlement of debt reduction companies however. Oh, they left that part out of their literature. But we are non-profit they claim. They are the richest non-profits in the world. Hence they pay much higher salaries and benefits to their employees, BECAUSE, every dollar they bring in, they earn $.10 to $.15 cents on it. Multiply that by millions of clients and you get a very wealthy company.
What they do not tell you is that their drop-out rate within the very first year in over 85%. In addition, they do not tell you that they put something on your credit report that looks like you filed for bankruptcy. Why, because they are in the business of protecting other credit card companies. By doing this, other companies will see it on your credit report, and deny you credit at least for the next seven (7) years.
However, choose they do, this debt consolidation option, not knowing there are other alternatives out there. The final selling point might be something like this: Debt consolidation is a lot better than bankruptcy. Not by what they put on your credit report! Conversely, debt reduction companies work directly with your creditors, not the three credit bureaus, to negotiate and settle you debt for a fraction of what you owe.
Many of these debt consolidation companies have prestigious names, such as the Consumer Credit Counsel or CCC to us in the industry. In addition, many Christians also believe that this is the best way to get out debt. However, not the guru of them all, Dave Ramsey. If you read his article at this link: http://www.daveramsey.com/article/the-truth-about-debt-consolidation/, you will see what we are talking about. Mr, Ramsey specifically states in this article that: “Debt consolidation is nothing more than a “con” because you think you’ve done something about the debt problem.”
Finally, the debt repayment plan for a debt consolidation is going to be much higher than that of a debt relief company, as you will be paying off the entire amount of the debt you owe, versus a negotiated settled amount of somewhere between 25% to 50% of your current balance.
If you are overwhelmed with your unbearable debt, you may think that declaring bankruptcy is your only solution; however this is almost certainly not the case. There are better solutions than debt consolidation. Please call our toll free number at 1-800-890-6658 for a free consultation on your specific financial hardship, as we know everyone situation is unique. Or you may visit the “Contact-Us” portion of our web site if after hours.