Posted on October 8, 2009 at 5:21 am Here the topic basically highlights basic difference between consolidation and settlement services. By Debt Consolidation loans you end up with good, or at least decent, credit. And if you chose Debt Settlement Company, they will handle your creditors and remove stress of harassing phone calls. The basic difference in debt consolidation loans and debt settlement programs is that with the prior you consolidate your debt into single monthly payment, and the latter will negotiate the payable amount and with comparatively low interest rates.This is the basic knowledge regarding debt consolidation and debt settlement, would like to have others opinions also shared here.

Posted on November 18, 2009 at 4:39 am Debt consolidation or debt settlement?It depends on the consumers debt amount and account status.Credit counseling - for debt amounts less than $10,000 and accounts currentDebt settlement - for debt amounts that are more than $10,000 and accounts past due.Destroydebt.com is offering a free initial debt consultation, just fill out a form here.

Posted on November 19, 2009 at 4:01 pm Debt consolidator services are wide spread and a person looking to consolidate his or her debt needs to know exactly what to look for.For example when you consider your creditscore (have you gotten any yet? " debt consolidation companies will match this info against your debt amount, income and a lot of other factors.

Posted on November 19, 2009 at 11:58 pm It also depends on your current state of financial affairs. Just to have you know, both approaches work if you have a steady source of income, because you will have to pay fees when you use these services. Yes, even non-profit credit counseling organizations do charge fees. A lot of people think that just because a company is "non-profit," their services are free or even legitimate. I think we all need to understand that fact, which is why we also need to exercise due caution in choosing the right debt consolidation company to work with.

Posted on November 20, 2009 at 11:53 am please keep in mind that with Debt Settlement you have your debt almost cut in half maybe even more if you go with a good company (i know a great financial consultant if you are interested) and with a consolidation you are still responsible for the entire amount of the debt, they just help you find a way to work out the payments. Also, Debt Settlement is interest free where as DC (Consolidation) will just help you manage late fees and lower  your interest ratesand please note that not all DS companies require a 10,000 minimum debt amount because I've worked with a company that only required 5,000 minimum amount of debt and they did wonders helping me out.

Posted on November 22, 2009 at 10:16 pm Not always true--there are varying ranges in terms of how much a particular debt settlement company can settle for. It is not always 50% or 70% or whatever. The percentage depends on how much the creditor and negotiator agree on.

Posted on November 23, 2009 at 3:18 am If you're also talking about a debt consolidation loan, I would highly discourage you from acquiring such. Getting a loan while you're currently indebted is not a very good idea of getting everything taken care of. You will be adding an extra burden on yourself if you get a loan to pay off everything else.

Posted on November 23, 2009 at 9:45 am While they use very similar terms and are both a means of alleviating your debts, there are many major differences between debt consolidation and debt settlement programs. Debt Settlements: A debt settlement program negotiates the balance due with your creditors in an attempt to have the consumer payback less than what was originally owed. Immediately this sounds ideal to any consumer struggling with their debts and monthly payments, but the cost to ones pocket and credit may not be worth the small savings to come. A settlement company requires monthly payments from their clients for 8 months to 1.5 years but does not send payments to the creditors each month. Instead, payments are held in an effort to create a large sum to negotiate the balance being paid in full for a smaller amount, usually 40-50% less. Like working with your creditors direct, if you’re not making consecutive monthly payments your credit can be tarnished with late marks and further fees incur on a monthly basis, raising the balance due and further damaging your FICO credit score. Furthermore, creditors are not willing to negotiate the balances down until an account is in a ‘charged off’ status. It usually takes 6 months of non-payment before a creditor will ‘charge off’ an account. That’s 6 months of added fees, negative reporting to the credit bureau, and harassing collection calls. Whether the debt is paid in full or partial, charged off accounts reflect negatively for 7 years on your credit report and multiple charge off accounts could reflect more poorly than a bankruptcy or repossession. In addition, the IRS takes their cut for the charge off loss by the creditor. Say you owe $10,000 to a Visa and a settlement company negotiates the payoff to $5,000. The following year you’ll be sent a 1099 tax form to claim the difference of the amount settled. The $5k difference is then considered taxable income by the IRS, so depending on your effective tax rate, you may have $500-$1,000 additional tax burden for the year your account is settled in. Debt Consolidation: A consolidation program negotiates the creditor terms to achieve reduced interest rates and the stopping of late, past due, and over limit fees. The monthly payment is usually reduced as well and most creditors will bring past due accounts to a current status after 3-6 months of consecutive payments, helping improve your credit score over time. Like settlements, payments are required consecutively each month. However, in a consolidation program payments are SENT each month as they are received by the client. This ensures the accounts do not fall behind and the new terms remain in place until the debt is paid in full. The balance owed is paid down on a monthly basis at reduced rates, allowing more of the client’s monthly payment to go towards the balance due rather than creditor fees and finance charges. Consolidation programs cannot exceed 60 months and depend on the amount of debt owed and the terms per creditor enrolled in the debt consolidation program. There are usually no additional fees for making extra payments or paying off the debt earlier than the time quoted. The consensus is, the faster the client is paid off the better for all parties as most agencies work off a referral basis from satisfied customers. If the agency’s’ fees are unreasonable chances are your financial well being is not their primary concern. A nonprofit agency will usually charge in accordance with your state’s guidelines and offer a low monthly service fee to cover in house expenses. In either instance you’ll want to do your homework before signing with an agency. A nonprofit agency is the best option followed by a review of the company’s Better Business Bureau profile and rating. http://www.bbb.org/. If you’re looking for credit card relief and an alternative debt solution that won’t hurt your credit, please contact a certified credit counselor for a free budget analysis to see what options are available to help you become debt free.

Posted on November 23, 2009 at 8:28 pm What you can also do is log on to DestroyDebt.com and fill out a form on the main page of the site. You'll be matched with a qualified provider from there, who will be able to help you out on your situation. The service is free, too.