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Consumer Credit Debt Consolidation

From Wikipedia, the free encyclopedia

"Consumer Credit Debt Consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan. Debt consolidation can simply be from a number of unsecured loans into another unsecured loan, but more often it involves a secured loan against an asset that serves as collateral, most commonly a house."

How does consumer credit debt consolidation differ from creditor debt settlement?

The major difference between consumer credit debt consolidation services and debt settlement is the fact that with debt consolidation you combine all your credit card debt in to one loan. With debt settlement, arbitrators negotiate on your behalf with your creditors for a significant discount to the actual amount owed. Clients then make more affordable payments to the debt arbitrators to pay off the remaining balance.

Before you consider consumer credit debt consolidation services consider this:

• Discharging credit card debt through bankruptcy, debt consolidation programs, or installment agreements are not the best solutions.

• Consumer credit debt consolidation requires you to pay back 100% or more of your debt and many debt consolidation companies are funded by credit card companies.

• With debt consolidation the amount of your debt that you owe remains the same. With debt settlement your debt is actually reduced.

• You must be current on your debts: Most consumer credit debt consolidation companies require that you be current on all of your accounts. Thus, if you are delinquent on any of your accounts, it may be difficult to enter into a program.

• Administration fees and monthly maintenance fees: The consumer credit debt consolidation company charges you for their services. This money could be going to paying off your debt.

• No missed payments: If you are late on one monthly payment you can be dropped from the program.

• Consumer credit debt consolidation doesn't help you eliminate debt. The reality is that most people don't complete consolidation programs because they aren't aimed at eliminating your debt.

Credit Alliance Group of Dallas, Texas offers an alternative to bankruptcy, debt consolidation and installment agreements. Debt Settlement Services truly work. Our debt arbitration specialists utilize our proven debt settlement techniques to rid you of credit card debt to help you regain control of your personal finances.