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Debt Consolidation Company

Debt Consolidation

Goal: Simplify your debts and potentially save on interest.

Method: Combines multiple debts into a single loan, ideally with a lower interest rate than your existing debts. This simplifies your payments and can save you money on interest over time.

Debt Relief Program

Goal: Reduce your total debt amount significantly.

Method: A debt relief company negotiates with your creditors to settle your debts for less than the amount you owe. You stop making payments to your creditors and instead make payments to the debt relief company, who holds the funds in a special account until there's enough to pay a settlement offer to your creditors.

Our goal is to help consumers determine what's best for their lives, that said, we may not necessarily have every company listed. However, the companies we do have will allow you to compare service options. Some of these options include: 

Save Money on Fees:

Debt relief companies typically charge a percentage of the debt they settle for you. By comparing quotes, you can find a company with lower fees, saving you money in the long run.

Find the Right Program Fit: 

Debt relief companies have different program structures, fees, and timelines. Comparing quotes allows you to choose a program that aligns with your financial situation and goals.

Uncover Potential Red Flags:

Not all debt relief companies are created equal. Some may have hidden fees, unrealistic promises, or a poor track record. 

Comparing quotes can help you identify potential red flags and avoid companies with questionable practices.

Here's a breakdown of how comparing quotes helps you achieve these advantages:

Saving Money on Fees: 

Different companies have different fee structures. Some may charge a flat fee, while others take a percentage of the debt settled. By getting quotes from multiple companies, you can see which offers the most competitive rates, potentially saving you thousands of dollars.

Finding the Right Program Fit: 

Programs vary in length, savings requirements, and communication style. Comparing quotes allows you to understand the program structure of each company and choose one that best suits your circumstances. For example, if you need a faster program completion you might prioritize companies known for quicker settlements, even if it means slightly higher fees.

Uncovering Potential Red Flags:

Some companies may make unrealistic promises about debt reduction or have hidden fees. Getting quotes allows you to compare the details and identify any inconsistencies or red flags. You can also research online reviews and complaints about different debt relief companies to get a better sense of their reputation.

Debt relief programs typically focus on unsecured debts. This means the debt is not tied to any collateral, such as a house or car, that a lender can seize if you don't repay the loan. Here are the common accounts that qualify for debt relief:

Credit Cards: Most credit card debt, including major credit cards, department store cards, and gas station cards, can be included in debt relief programs.

Personal Loans: Unsecured personal loans can be included in debt relief.

Medical Bills: Medical bills are a common source of debt for many people and can be included in debt relief programs.

Lines of Credit: Unsecured lines of credit, such as home equity lines of credit (HELOC) used for unsecured purposes, can be eligible for debt relief, though some programs may exclude them.

Here's what typically doesn't qualify for debt relief:

Secured Loans: Mortgages, auto loans, and other loans secured by collateral cannot be included in debt relief programs. The lender can repossess the collateral if you don't repay the loan.

Student Loans: Federal student loans and most private student loans cannot be settled through debt relief programs. There are options for repaying student loans, such as income-driven repayment plans, but these are not considered debt relief.

Taxes: Tax debts owed to the government cannot be included in debt relief programs.

It's important to note that specific debt relief programs may have their own criteria for what types of debt they accept.  Always check with the debt relief company you're considering to see what they handle.

Debt consolidation and debt relief programs take significantly different amounts of time to complete, each with its own factors affecting the timeframe. Here's a breakdown:

Debt Consolidation:

Generally takes shorter to complete, typically within 3-5 years.

The exact timeframe depends on the amount of debt consolidated, the interest rate on the consolidation loan, and how much you can afford to pay monthly.

You continue making regular payments throughout the program, working towards paying off the entire debt.

Debt Relief Program:

Typically takes longer to complete, with an average range of 2-4 years.

Several factors can influence the program length:

Total Debt Amount: Larger debts take longer to negotiate settlements with creditors.

Savings Rate: The faster you can save money towards settlements, the quicker the program progresses.

Creditor Negotiation: The willingness of creditors to accept settlements can significantly impact the program's duration.

Here's an additional point to consider:

Debt relief programs often require an initial savings phase before any settlements are offered to creditors. This can take 7-9 months on average before you start seeing any debt resolved.

In conclusion:

Debt consolidation offers a faster path to becoming debt-free, assuming you can qualify for a favorable interest rate and make consistent payments.

Debt relief programs take longer but can significantly reduce your total debt obligation.