31 Ways to compare and evaluate debt consolidation and settlement
| # | Questions | Debt Consolidation | Debt Settlement |
| 1. | Is free budget counseling offered? |  |
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| 2. | Will your outstanding balances get reduced? |  |
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| 3. | Can the interest rates on your debts get reduced? | |
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| 4. | Does it affect your credit report negatively? | |
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| 5. | Are creditors/collection agencies legally bound to stop calling you? | |
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| 6. | Is this a viable option to repay your unsecured debts? | |
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| 7. | Will you be able to repay your secured debts? | |
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| 8. | Do you need to pay professional fees? | |
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| 9. | Can you deal with creditors yourself? | |
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| 10. | Are there any tax implications? | |
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You'll be liable to pay tax on the total amount saved through settlement. The amount you save is considered to be income by the IRS. |
| 11. | Can you become debt free within a month? | |
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| 12. | Can a creditor/collection agency sue you? | |
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| 13. | Do you need to have a valuable asset? | |
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| 14. | Is it true that you can repay bills with single monthly payments? | |
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| 15. | Do you need to make lumpsum payment(s)? | |
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| 16. | Do you have to take help from a lawyer? | |
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| 17. | Is it a suitable option to repay private student loans? | |
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| 18. | Is agreement signing mandatory? | ?
You should always sign a written agreement to avoid unnecessary disputes in future. Read the agreement carefully. Clarify all your doubts before signing the agreement. |
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Draw up a contract with the settlement company. Check the terms and conditions of the contract before signing it. Read the fine print section carefully. |
| 19. | Can it remove debts incurred from community properties? | |
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| 20. | Can you get rid of debt legally? | |
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| 21. | Does it help repay low debt amount? | |
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| 22. | Can you get help if you're delinquent on loans? | ?
Though it varies from one creditor to another, yet they usually don't agree to reduce interest rates when you're already delinquent on loans. |
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Usually, creditors agree to settle your debts if you're delinquent on loans. |
| 23. | Can you become a victim of wage garnishment? | |
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| 24. | Is there any role of trust account? | |
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| 25. | Is it better than filing a bankruptcy? | |
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| 26. | Can you repay business debts? | |
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| 27. | Does it help repay payday loans? | |
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| 28. | Can you cancel the program midway? | |
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| 29. | Can you pay off one of multiple accounts? | |
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| 30. | Can it help stop foreclosure proceedings? | |
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| 31. | Does it help pay off medical bills? | |
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