Has anyone ever used a debt management service? How did it affect your credit rating? Would you reccommend it?
I wish to discharge a rest of my credit label debt. we see a ads for debt government services where they work with your creditors to revoke your seductiveness rates, afterwards mix all of your debt together, where we compensate them a single remuneration per month. My father thinks this will simulate negativly upon a credit report. Has any one ever finished this, as well as were we succesful in expelling debt? Did it start your credit rating in a nigative manner? we consider which most people in America today, have alot of consumer debt, though we see most poeple who aren’t disturbed about it, as well as usually compensate a monthly minimums any month. we have been there before, though we am ready to compensate it all off. What do we think? we would adore to listen to from any one who has used these services before, or any alternative good thought to compensate it all off, but receiving out any some-more loans. Thanks!
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My husband and I did that a long time ago and yes, it works. No, it doesn’t reflect negatively on your credit rating.
They sat us down with our bills and had us make up our own budget that included food, entertainment, savings etc.
I suggest you pick a non-profit company as we did. They get their payment from the creditors instead of you.
They won’t do much. In the end they will make a big chunk of change.
If it were me, I would go to my bank and tell them I want to consolidate all my debts into one monthly bill by getting a second mortgage(you would benefit on the tax write-off) on my house that is enough pay off all my bills that I have, which will save me from paying all those credit cards high interest rates while reducing my payment to a single monthly payment. This is exactly what those debt management companies are really doing. They will shop around with different lenders to see who will give you the best interest rate. They are not really working with the creditors to lower your interest rate. They are just going to get you a loan for however much you owe to pay off yall your credit cards for you and tell you along the way you have to file this, do that and etc to improve your credit rating. So you are still stuck with a new loan and a term to pay off, but now you just don’t have to pay as much monthly. Saving you in the short run, but costing you in the long run. HELOCs are another great way to go if you have the home equity. They usually don’t charge any fees for this loan.
In the end you will have to pay someone some money, but if you go to one of those debt management guys, be aware they have to get paid too. Why pay two companies when you only need to pay one?
Sorry if its hard to understand. Its getting a bit late for me.
The following articles should answer all your questions:
Debt Consolidation – Get Out Of Debt
How to Hire a Debt Counselor?
What is Debt Relief?
Debt Management and Building Wealth
I go through a not for profit credit counseling service such as the previous answerer did. They helped to lower my interest rates. My interest rates skyrocketed before I consulted them because I could only afford the minimum payments. I give them a small donation each month to help with their costs. I would not recommend taking out a home equity loan or anything of that nature because if something happens and you can’t pay, your house is at stake. With credit counseling, you don’t have that to worry about. Be careful because many companies are out there to scam you. Go to clarkhoward.com to get more info on legit credit counselors.
well, I don’t promise anything but
people in debt often seem to find some help here :
and here
good luck!
I used a debt management program to pay off over $26,000 in credit card debt and it was the best thing I ever did!!! I had to give up all of my credit cards and learned that I could live without them. I learned how to budget my money for monthly expenses, everyday expenses and how to save for long term. You may have to be willing to give up some expenses (cable or eating out a lot) to make your budget work, but trust me, in the end it was all worth it. It is such a satisfying feeling to do fun things (go on vacation) without using credit cards!!! I have so much more money now that I have my credit cards payed off!!
When I first started the program, a couple of the cards showed that my payments were late because you have to be in the program for 3 months before the creditors will accept the details of the program. Yes it does come up negitively on my credit report, but I feel that this is a very small price to pay to not have any credit card debt. Having large amounts of debt also shows up negitively, you have to decide which negative you want…I still have been able to purchase a home and I opened one credit card (they gave me an $11,000 limit) to use responsibly!! I don’t know my exact credit score right now, but it is around 670….which is not bad.
I would not have been able to pay off my credit card without this program. They are able to negotiate your intrest rates. I had one that went from 22% to 9%….most of them went to 9% Except for Discover card….they are not very good at lowering the rate.
I would highly reccommend a credit couseling service to anyone with credit card debt. Just make sure that you use a non profit service. Go to this is what I used. You can at least schedule a free consultation with a counselor and they will be able to answer all of your questions. They will also look at your income vs. your debt and help you budget. They will look at all of your credit cards and tell you how much you will have to pay each month and how long it will take to pay it off. My plan was set up to have it payed off in 56 months – that’s less than 5 years vs. probably 30 years if you just pay the minimums. If you want they will also set up the program so they are paying all of yor bills (house, car, utilities etc…) I just did credit cards.
I highly reccommend a credit counseling service… GOOD LUCK
They are in my opinion very worth while as they can often write off allot of the debt if you simply cannot afford to pay the money which can be a huge relief.
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