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Debt consolidtion vs CC balance liquidation program

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Dear Expert:

We have about $55,000.00 of credit card debt we have been valiantly trying to pay off for several years. I am a partner at my firm (self employed) and the past couple years have been very shaky but we have managed to stay current on all cards (6 total) until recently. My income is decent but can be on and off based on business cash flow.

We are now behind on 3 cards. I have been able to convert these 3 to a BLP (Chase) to a 2% or less rate over 41 months. This of course closes my accounts.

The other 3 cards are in good standing but have large balances and high interest rates; approx, 17,500 of the 55,000. The majority of this is from business losses.

I have been talking with Wells Fargo about a personal loan to consolidate all or some of the cards. I was told it is better to have a personal loan vs a card balance. I am not sure how true that is.

I have several questions - essentially what is the best strategy for dealing with this:

  • Is it a good idea to try and consolidate all cards?
  • Is it better to try and consolidate the higher interest rates only and continue with the BLP's?
  • I am strongly considering settlement, but am concerned about credit rating - which is excellent with the except of debt management category.
My over-arching question is what is the best strategy for handling this. We really want to get out from under the debt & we do feel the credit card companies have made alot of money on us.

Any help would be greatly apppreciated.



Welcome to the forums!

I think it will be better to consolidate the cards. Once you enroll into a consolidation program, the debt consolidators will negotiate with your creditors and reduce the interest rates on the outstanding balances. late fees and penalties will also be waived off. You'll only be required to make a low single monthly payment to the consolidation company. To know more about debt consolidation program, visit the following page:

Sub: #1 posted on Sun, 06/05/2011 - 22:01

Good Nelly Good Nelly
Industry Expert
(Posts: 2758 | Credits: )

If you're concerned about your credit score, then consolidation is a better option as compared to settlement. If you consolidate and pay off your debts, then the account statuses will get updated as "Paid in Full", which is favorable for your credit report and can increase your score by several points. But, debt settlement may affect your score negatively. However, debt settlement can be a suitable debt relief option if your financial condition doesn't permit you to pay back your debts in full and you want to get rid of your debts fast.

Sub: #2 posted on Mon, 06/06/2011 - 03:05

MarieGarcia MarieGarcia

(Posts: 17 | Credits: )

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