Credit Card Debt Relief – What’s the Difference Between Debt Consolidation and Settlement?
Debt relief can take many different forms. These forms run the gamut from declaring bankruptcy to winning the lottery, the former not being a good idea as it ruins your credit and the latter being more rare than being struck by lightning twice in the same spot on the same day. So if you’re looking for debt relief, what avenues are there available to you? Let’s say you’re $10,000 in debt and the debt takes the form of two or more credit card accounts. Here are a couple of options to look at and compare:
1. Debt consolidation – debt consolidation might be considered a form of debt relief, except that you will be taking smaller amounts of debt and combining it into one huge amount of loans. The advantage here would be to lump all your debts under one roof and have one payment per month instead of smaller payments scattered throughout different pay dates in the month. It’s also possible you will get a lower interest rate than your credit cards, but there’s also the probability that the consolidation will cost you money up front or added to the new loan. And after all that, you still have the same debt you started with. A better option might be debt settlement.
2. Debt settlement – the debt settlement option for financial relief is more of a negotiation versus a consolidation. Here that $10,000 worth of debt is looked at by professionals trained in the art of debt settlement. They will work with you to discuss your total debt and the methods they will take on your behalf to not only settle your debt, but reduce the amount you owe. They will work with your creditors to settle your accounts. Your creditors, knowing that getting some settlement versus no settlement, are now more than ever willing to work with settlement companies. In today’s economy, more people are forced to go the route of bankruptcy, leaving creditors holding nothing and you, the consumer, holding nothing for years to come and with the negative stigma of bankruptcy over your head.
Debt settlement is not financial consolidation, it is financial elimination, which can be your start toward debt relief.
Debt settlement is a legitimate way to make a deal with your creditors and walk away only having to pay half of what you actually owe. If you have over $10,000 in unsecured debt and realistically can’t pay it back then you might want to consider debt settlement.
To locate legitimate and reputable debt settlement companies in your state check out the following link:
