What's in Your Best Interest?
Consolidating your debt through a convenient debt consolidation loan is one of the best options available for anyone interested in getting their personal debt under control. Debt consolidation is fast, simple and can save you tons of money. But it's important to consider all your options.
Debt settlement: the alternative to consolidation
If you're thinking about consolidating your debt through a debt consolidation loan, you might also consider debt settlement. Debt settlement is a way to help consumers regain control of their finances. And it offers a realistic alternative to either living with overwhelming debt or opting for a debt consolidation loan.
How does debt settlement work?
When you apply for debt settlement, your debt settlement service works with your creditors to find a realistic solution to your overwhelming debt. Everyone makes mistakes. And it's easy for consumers to fall into debt way over their heads. While your debt settlement service negotiates a settlement deal, you stop paying your creditors. Instead, you make monthly deposits into a special escrow account that you will later use to pay off your debt. In most cases, creditors will let consumers settle their debts by paying 40% to 60% of what they actually owe.
Who should consider debt settlement?
Debt settlement isn't for everyone. But if you're at least $10,000.00 in debt, you should seriously consider debt settlement. Additionally, debt settlement works best if unsecured debt (such as credit card debt) is the source of your financial problems. It is very difficult, and often impossible, to negotiate successful debt settlement over secured debt. Learn more about secured and unsecured debt here.
How will debt settlement affect my credit score?
Unfortunately, debt settlement will have a negative impact upon your credit score. After all, if you have a history of repaying your creditors 40 to 60 cents on every dollar borrowed, future lenders will consider you an above average risk. But the good news is that it's easy to recover quickly and effectively from the negative mark of debt settlement on your credit score. Learn about planning for the future on the next page.
