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Debt consolidation programs claim to help families and individuals avoid bankruptcy by consolidating debts into one monthly installment.

Some programs offer first-time free counseling, which includes debt information and information on how to reduce or eliminate interest rates on credit cards. These programs will assess your needs carefully,
claiming to search for the best plan for you.

After your information is analyzed thoroughly by a qualified representative, they will then begin to develop a strategy to help you budget your income so that you can payoff your bills and increase your income. These organizations will help you keep records of your spending, learn how to prepare for emergencies, and at the same time, help you to manage your debts.

Furthermore, the companies that help you organize may see a need to refer you to qualifying debt management programs that offer counseling. These counselors will contact creditors on your behalf, including business creditors, legal creditors to negotiate, and arrange lower monthly fees, including rates of interest.

The programs may even ask for waiver on fees for late charges, and will ask for elimination of accounts past the seven-year guideline. Once the plans are set in motion, they may require you to send one monthly installment to the debt consolidation agency, which then will then be broken down into payments and sent in the arranged amounts to each creditor.

As you can see the plans seem amicable; however this is not always the case: some programs will charge up to $70 per month, plus interest for helping you get out of debt. This means if your plan is to repay $500 per month, then only $430 of that amount will apply to your debts after and/if the programs charge interest rates and also after the rates of interest are deducted. In this event, maybe only $400 is giving to the creditors, which means you are paying out $100 each month simply for debt servicing.

Posted: Tue Nov 27, 2007 8:54 am Subject:

They have to charge something for there services or they could not remain in business even if they are a NPO. On this site there is a rating for them according to the experiences of the people who have used them.You may find that helpful.

Thanks..

I would sure look at that

Posted: Tue Nov 27, 2007 9:50 am Subject:

My suggestion would be to input a company name in your search engine and see what comes up. User reviews are always the best. I don't trust the BBB as much as I used to.

Posted: Tue Nov 27, 2007 1:17 pm Subject:

Absolutely, FYI. I completely agree and strongly advocate research because you'll be with a company for years sometimes. You need to make sure it's not only a good fit for you, but that it's legit number one because you're leaving yourself vulnerable somewhat (i.e. giving out banking information). I remember with my company, I would give them money orders at their request. Then I allowed to them to withdraw money right out of my bank account. that takes a lot of trust. thankfully all went well and i'm mostly out of consumer debt. please research as much as you can, especially with the BBB and this site