Question by kev: Credit Card Debt Consolidation?
These companies that offers debt consolidation and credit management, do they really cut your credit card bills to 40%??
Best answer:
Answer by Rick B
No No No No.
You can do it yourself.
Call all of them and negotiate a lower interest rate and monthly payments.
Pay all the minimums, then pay all your extra cash to the lowest balance debt. Once that one is paid off (which should happen quickly) pay that extra amount (plus what you were paying as the minimum on that card) to the next lowetst balance.
Continue your debt snowball until everything is paid off.
Then STAY AWAY FROM CREDIT.
Give your answer to this question below!
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{ 2 comments… read them below or add one }
There was a lady here crying that she gave care one consolidation company 3,000 dollars. After 3 months, they had not paid any of her bills. She seemed confused.
Be careful.
Other advise I’ve seen here is that you can do this on your own. Call each company, and threaten to close your accounts unless they can lower your interest rate. Also get your credit report at annual credit report . com
(if they charge you = it’s not free) no need for a score – that’s a waste of money.
Once you get your report dispute things.
That’s about all these companies do for you.
Good luck.
.
Most of them are bogus. What they offer is to negotiate with your creditors to reduce your payment bur from what I read in an article in Business Week, many times they do not succeed. This sometimes takes months and these companies will take your money in advance. Eventually, you will be stuck with late fees plus the original amount. So do not go for this.
Instead go in for credit counseling. The counselor will work out a debt management plan if you qualify or work out an alternate plan. Under a debt management plan , you will make payments but at a reduced interest rate. It can save you upto $200 to $300 per month depending on the amount of your debt. Usually, people have about $18,000 in credit card debt (those who are in trouble)