What's the difference between managing debt and putting all your debts into one payment? What are the benefits of using these methods?
Debt management includes a wide range of services and activities related to debt, such as reducing debt, consolidating it, negotiating it down, settling it, economic failure, credit repair clinics, and even getting a credit report.
In America, people have, on average, eight credit cards and $9,340 in debt. One of the main reasons why debt has grown at a rate of 5 percent a year is that interest rates are so high (18–25%). So, debt consolidation is a process that saves you from having to deal with big debts from many different creditors.
Debt consolidation helps you get your monthly payments down to a level that is more manageable. As was mentioned above, there is a huge need for this service, which is why so many debt consolidation companies have opened in the past few years.
Are debt consolidation companies safe?
Today, many people are afraid to work with debt consolidation companies because so many people have been taken advantage of by bad debt consolidation companies. The trick is to be very careful about which company you choose.
We personally think that you shouldn't choose a debt consolidation company until you've looked into its past. You should also try to stay away from credit repair clinics, since a lot of them are clearly breaking the law.
So don't just believe everything you see in ads. Talk to all of your possible consolidators and ask them questions. Make your own decision.
How will a good company that combines my debts help me?
A debt consolidation company can help you in many ways, such as the ones below:
- It can get you out of debt as quickly as possible, no matter what your situation is.
- It can help you keep from going bankrupt.
- It can help you cut your monthly payments by 40–60%.
- Interest rates can go down because of it.
- It can get rid of late charges.
A lot of these businesses have websites and also offer free counselling to their customers. You can use these services to meet your needs and possibly get out of debt without paying anything.
