Difference between Debt consolidation and credit counseling

Welcome to the Forums :D In most cases, the credit counseling is just that-counseling. They tell you of options you may have to deal with your debt, such as consolidation, and then give you an option to choose one or not. I'm not sure about the reporting on your credit, and how it differs. Someone will know the answer and get back to you soon-..KAren I am deleting your duplicate posts

Try reading this page on the site. It might be of much help to u in understanding how to become debt free.
http://www.debtconsolidationcare.com/debt-solution.html

Good Luck,
Ang

credit counseling and debt consolidation are two popular methods that help debt struck people in managing their debts.

Credit counseling is the best option if your debt has grown faster and the situation is beyond self recovery. When you know that you are in trouble and need to make long-term financial changes, go for credit counseling. Credit counseling services provide guidance on
??????? How to manage finances and debts
??????? Help you in developing a feasible budget that will be in sync with your income
??????? Provide free educational materials and workshops to make you more credit smart.

All you have to do is to get enrolled for a counseling program. Then you will be guided by certified and experienced counselors who have years of expertise in the areas of consumer credit, money and debt management, and budgeting. The counselor will look into your financial condition and on the basis of that he will chalk out a payment plan to tailor your needs. The counselor will negotiate with the creditors on your behalf and ask them to lower the interest rates and waive off certain amount of late fees. In case of credit counseling, you do not have to pay your bills directly to the creditors. You just have to make one payment to the counselor. The counselor will then pay your creditors according to the payment schedule. Thus credit counseling services not only help borrowers in reducing their debt load but also guide them in managing their debt properly.

On the other hand in debt consolidation you can combine all your debts into a single lower interest debt. Nowadays people hold more than two credit cards and have multiple loans. Each loan and credit card has different payment date and at the end of the month it becomes nearly impossible to remember each and every date. And what happens is late payments or miss payments. The situation gets even worse if you are just making the minimum payment, because the interest and financial charges get accumulated over the debt. If you are consolidating your debts into one loan, then you do not have to worry about paying twenty bills to twenty different creditors. So, debt consolidation not only helps you in managing your finances but also reduces your chances of being late. The debt consolidation program reduces your debt amount by cutting off some amount from the accrued interest and penalties.

I hope this was useful.