Is it bad to consolidate credit card debt through a debt consolidation company?

Public Comments

1. i think it is better to get a personal loan through a bank. but using one of those companies is better than not being able to make payments. it also depends on the interest rate being offered.
2. Yes... What they did to me was, they told me to stop paying on my credit cards and to change my contact numbers to their numbers so when the creditors call, the attornies will try to make a settlement. I was able to pay nearly half of my credit card debt on 2 cards, but, my credit is at an all-time low now. It used to be damn near perfect. Don't Do It...
3. It all depends if you like paying that compnay to handle your affairs for you. Through a personal loan at your bank you can consolidate all your debts into one loan and undoubtedly save money on a monthly basis. Trouble is, non of it will be tax deductible since you can't write off any interest paid on anything other than a mortgage payment. if you have a home with some equity then refianancing it and paying off your debts are a smart way to go especailly since the interest is now tax deductible and so are you closing clost for doing the loan in the first place. Moreover, the rate you'll receive on a home loan will be far less than that of a personal loan. FHA rates are at 5.875 and they've lowered their guidliness to allow people even with less than stellar credit to qualify for their loan. Please visit www.myifconline.com for more information.
4. It will ruin your credit for about 5 years, but it's worth it to get those bills in order and it does lower your interest rate. But, on the other hand, while you are in the program, you can't buy shit. Not even a car or washing machine if you need it. You need to weigh out the choices on what's best for you.
5. The term 'Debt Consolidation' can mean different solutions to different people. It all depends on the you present financial condition and you goals. Let me first explain to you the variations (if you might call it that) of debt consolidation. Debt consolidation comes in many forms, so it is important that you reflect on what your needs and concerns and financial situation are before deciding which route you would like to take. The four primary concerns for most consumers are: i) monthly payment ii) time to debt freedom iii) total cost iv) the credit rating impact of the consolidation program. Debt Consolidation Loan Many people think first of a debt consolidation loan when seeking online debt consolidation. This option typically means a second home loan (or home equity line of credit) or refinancing your primary mortgage. In a debt consolidation loan, you exchange one loan for another. The most frequent form is taking out a mortgage loan, which carries a lower interest rate and is tax deductible, to pay off high interest rate credit card debt. It is important to be aware that shifting unsecured debt to secured debt can create a volatile situation, if there is ever a chance that you cannot afford the new mortgage payment you are now putting yourself at risk of foreclosure! In the case of a debt consolidation loan, most mortgages are 30 year loan, which means that the total cost and the time to debt freedom could be very high? but the monthly payment will be lower than other options and there is no credit rating impact. Credit Counseling Credit counseling, or signing up for a debt management plan, is a very common form of online debt consolidation. There are many companies offering online credit counseling, which is essentially a way to make one payment directly to the credit counseling agency, which then distributes that payment to your creditors. Most times, a credit counseling agency will be able to lower your monthly payments by getting interest rate concessions from your lenders or creditors. It is important to understand that in a credit counseling program, you are still repaying 100% of your debts ? but with lower monthly payments. On average, most online credit counseling programs take around five years. While most credit counseling programs do not impact your FICO score, being enrolled in a credit counseling debt management plan DOES show up on your credit report? and, unfortunately, many lenders look at enrollment in credit counseling akin to filing for Chapter 13 Bankruptcy ? or using a third party to re-organize your debts. Debt Settlement Debt settlement, also called debt negotiation, is a form of online debt consolidation that cuts your total debt, sometimes over 50%, with lower monthly payments. Debt settlement programs typically run around three years. It is important to keep in mind, however, that during the life of your debt settlement program, you are NOT paying your creditors. This means that a debt settlement solution of online debt consolidation will negatively impact your credit rating. Your credit rating will not be good, at a minimum, for the term of your debt settlement program. However, debt settlement is usually the fastest and cheapest way to debt freedom, with a low monthly payment, while avoiding Chapter 7 Bankruptcy. The trade-off here is a negative credit rating versus saving money. Net-net: While there are many forms of online debt consolidation, many people with good to perfect credit who own homes should look into debt consolidation loans, while consumers with high credit card debt and poor credit may want to explore debt settlement or debt negotiation. However, each consumer is different, so find the online debt consolidation option that fits for you.
6. Yes it is bad, and does not look good on your credit score or credit report....it still says, you could not make your bills, and went to debt conl, and they got all your payments lowered so you could afford to pay.. is not a good thing to do, no matter what the commercials says, it is harder to get back your good credit score by doing this....we tell our clients every day, do not go through the debt conl or debt management programs,, they are no good for your credit. take out a loan and pay off all your bills, and pay one monthly payment that way...why pay a huge fee to someone that cannot clear the credit report for you. they often, take your money for the payments,and then do not make your payments on time, then the creditors you owe, will report this against you. again, we have these bad cases every week, and the consumer, ends up paying alot more than necessary. go get a loan, and save your credit and your money.... good luck Paralegal 20 yrs
7. No its not bad............as you are not the expert in that area and you may not know about the possible solutions. They can provide you with the best possible options. You can get more details from this link : http://ezconsolidation.com/debt_consolidation.php
8. You don't need to incur the extra expense of hiring a debt consolidation company to settle your credit card debt. It makes a lot more sense to use your money to pay your creditors directly than to pay someone else to do it for you. Your creditors will not make any concessions to them, in fact they would much rather work directly with you. Here is some general information that will be helpful. If the account is still at the bank or collection agency (and you will have to differentiate between an agency, which collects for the bank and is accountable to the bank, and a debt buyer, which collects for itself) level, you should be able to settle it for 80% - 90%. They won't accept anything lower than that. If the account is at a debt buyer, you should be able to settle it quickly. Keep in mind that if they had just bought the account within the past month or two, they will not accept anything lower that 60% - 70% of the total amount as a settlement. If they've had the account for 3 - 6 months, they will accept a lower settlement, probably you can get it down to 50%, maybe even lower than that. Also, chances are that after 6 - 7 months, they will sell the account to another debt buyer. Make sure, when you settle, to get from them a "paid in full" letter, which you will have to send to the credit bureaus to update your credit history. That is all there is to it. You are much better off using your money to pay off your accounts than to pay someone else to do it for you. Good luck!
9. it is best if you consolidate your credit card debt since it will lessen your interest up to 60%.