Debt Consolidation Company Information - Compare Debt Consolidation Companies Online
Not all debt consolidation companies
are the same. Some are in the business of offering
you a service to pay off your bills and clean up your
credit history. Others take advantage of your situation
and scam you out of your money. To protect yourself
from such companies, compare programs based on their
services and promises.
Non-profit Versus For-profit
The only difference between non-profit
and for-profit debt consolidation programs is how
they file their taxes. Some of the largest fraudulent
companies claimed non-profit status.
However, there are many legitimate non-profits.
Some of these companies are subsidized in part by
creditors, reducing fees you would have to pay. This
is especially true for agencies which cater to those
with poor credit.
Legitimate for-profit companies charge
comparable rates, but they usually focus on those
who still have a good credit score but are struggling
to pay bills. Like a non-profit, they can reduce your
interest rates for most types of unsecured loans,
making repayment easier.
Monthly Payment Quotes The Litmus
Test
The real litmus test to find a credible
debt consolidation company is to request a monthly
payment quote. By providing information on your account
balances, interest rates, and creditors names, a debt
consolidation company can give you an accurate quote.
Compare this payment with several other agencies.
Since all companies will get you the
same low interest rate with a creditor, there should
be very little difference between quotes. Anything
too low is a sign of a shady deal.
Services Provided
Besides requesting quotes, you should
also research the services they provide. Debt consolidation
involves constant communication with creditors to
lower rates, remove late charges, and close accounts.
Companies that fail to mention what they do for you
are probably more interested in taking your money
than servicing your accounts.
Also be suspicious of companies that
offer debt settlement or bankruptcy help. If they
are doing their job, there is no reason to use these
credit damaging services.
In the end, take the time to research
companies to find one you are comfortable with. By
making the investment of time now, you can save yourself
headaches in the future.
To view our list of recommended debt
consolidation companies online, visit this page: Recommende
d Debt Reduction Companies Online.
Carrie Reeder is the owner of ABC
Loan Guide, an informational website about various
types of loans.
