Comments on: Debt Consolidation a SCAM?

By: Sue S

Sue S — Fri, 23 Oct 2009 15:06:38 +0000

Debt consolidation makes sense if you're in debt because of a temporary situation, such as a period of unemployment that's ended or a medical condition which is now resolved. Be sure that your new interest rate is lower than the old one, otherwise it''ll cost you more than what you're paying now. Be sure, too, that it's not secured by your home. A credit card company can't take your property if you don;t pay, but if you have a secured loan they can.

Above all, be sure you can get by without using credit cards if you're going to consolidate your debt. Too many people use a consolidation loan to pay off their maxed-out cards, then they continue using the cards, and pretty soon they have twice as much debt as they did before.

By: Free Blog

Free Blog — Fri, 23 Oct 2009 05:44:31 +0000

Have yo made use of a debt consolidation service? If so how do you find out about it? Did it work for you?

By: WPMixer

WPMixer — Thu, 22 Oct 2009 10:55:09 +0000

Interesting point you made, but have you gone through a similar experience and was it more successful than what Suze says here?

By: Sarah

Sarah — Thu, 22 Oct 2009 01:13:15 +0000

Lenders usually only give debt consolidation loans to people with good credit….Even if you qualify, doing debt consolidation can be a dangerous path to go down…It takes extreme discipline to do this…..After their credit cards are paid off from the consolidation loan, to many it's simply too tempting to use all that available credit again on their credit cards…and you can quickly find yourself in twice as much debt as before.

Another option: Contact your local Red Cross for a referral to the local Consumer Credit Counseling Services (CCCS) in your area. They can negotiate much lower payments and interest rates. They DO NOT negotiate settlements.

They will require you to stop using all credit and to cut up your cards. Your credit report will be updated to "enrolled in debt management." This does not damage your credit, but it may make it impossible to obtain new credit while you are enrolled in their program….so don't use this service if you anticipate applying for a new apartment, car loan or mortgage anytime soon, as you would probably be denied while you're enrolled in the CCCS debt management program…. Otherwise, it can be a very good way to deal with your debt.

By: Happy Girl

Happy Girl — Wed, 21 Oct 2009 15:05:59 +0000

Debt consolidation can be a good and bad thing if you get a good debt consolidation program.
You need to find one that you make a monthly payment to and they pay all your credit cards for example lets say I owe $25K for 6 different credit cards and I pay the the debt con. $ 500 per month and they disburse the money to all 5 credit cards (they contact the credit card up front and ask them if a payment of $X is acceptable and they agree) then they pay each monthly. yes the debt cons do charge a monthly fee usually not over $50 per month but you send them or have directly taken from your checking and they pay them,
Beware for the debt cons that state you send them X amount monthly and then put in a saving and when you reach the amount you owe all of them then they will disburse the money. the fee they charge is in the hundreds.
In-Charge is a good debt cons to look into, their monthly fee was $35 and they were great.
Always read the fine print before accepting anything, in fact in-charge you call them or email them and you give them you monthly financial and they will let you know how much you can afford to pay monthly.

By: WPBlog Shop

WPBlog Shop — Wed, 21 Oct 2009 13:31:44 +0000

Suze Orman is correct; just that the title of this video is misleading.

By: ✫✫✫✫

✫✫✫✫ — Wed, 21 Oct 2009 11:13:25 +0000

No, it is not always a scam. Debt consolidation and debt elimination are two different animals and should be looked at separately.

Basically, debt consolidation helps you in accumulating your multiple debts into one single debt, lowering your payable amount. The debt consolidation companies do this by negotiating with your creditors.

1. Waives off the interest rate:

Debt consolidation helps you to eliminate or reduce the interest rate. The debt consolidation companies bargain with all your creditors to reduce the interest amount of your debt. This way they help you to lessen your debt amount.

2. Single monthly payment:

If you have multiple debt payments, like credit card bills, utility bills and medical bills and is missing your regular monthly payments, debt consolidation is the best option for you. It saves you from becoming a defaulter. The debt consolidation program allows you to merge all your debts into a single debt and make a single monthly payment for all the debts you owe. The debt consolidation company will deal with all the creditors on your behalf. This would make your handling of debts much simpler.

3. Get rid of creditor calls:

The debt consolidation company not only consolidates your debt payments but also helps you to avoid creditor calls. Whenever you sign up with a debt consolidation company, they assure you to communicate with all your creditors on your behalf. As a result, the creditors stop calling you.

4. Sound credit score:

If you consolidate your debts, you can reduce your outstanding debts in a set out plan. Within a short span the consolidation company helps you to repair your bad credit and get out of all your debts. This way, by reducing your debt burden you can also raise your credit score to some extent.

Debt consolidation is an effective way to get debt relief. Online debt consolidation has become very common these days.

By: ♪ ♫sadeyes♫ ♪

♪ ♫sadeyes♫ ♪ — Wed, 21 Oct 2009 04:24:01 +0000

STAY AWAY from any "debt consolidation" company that promises to cut your debt in half through debt settlement….This is a risky tactic of deliberately ceasing all payments to creditors and forcing your accounts into default to attempt settlements. You pay a monthly fee to a debt consolidator….this entire fee goes towards building a settlement account and to the consolidator's fees to “settle” your accounts in the future. Your credit card companies will deliberately not be paid so that all the accounts will default/charge-off so that they can attempt settlements at around 50%. If you are current on your accounts, this process will ruin your credit rating for sure. Debt settlement is like a roll off the dice with your finances…You can never predict how your creditors will respond to the deliberate defaulting of your accounts…they might settle at 50%…or they might serve you a summons, take you to court…and if they win, you could be looking at wage garnishment.

None of these “debt consolidation” firms have the power to force your creditors to accept settlements. Your creditors have the right to refuse these terms and take you to court.

http://online.wsj.com/article/SB122394458494631223.html

http://www.youtube.com/watch?v=jS43XFa3KGU

By: Wordpress

Wordpress — Wed, 21 Oct 2009 01:18:14 +0000

What she doesn’t mention is that not evryone qualifies for a debt management plan and in some instances settlement and bk are the only option.

By: Free Blog

Free Blog — Tue, 20 Oct 2009 20:33:36 +0000

I work for a non profit consumer credit counseling, so I know about consolidating and settling debt