credit counseling or debt consolidation? so confused!!!?
my husband and i are in credit card debt 35,000.. medical bills around 1,800 and school loan about 5,600… we are paying them all the minimum and killing ourselves doing so. we both work and hard to so please no answers about a second job. we are renting right now and are always late paying rent and car payments and our car was just repo last night. we are stuck right now and really don’t want to file bankrup. my question is since we are a paying things on time can we even do credit counseling or debt consolitation? i heard that you need to be behind on your debts is that true? and what is the difference between credit counseling and debt consolidation. thank you very much for the help…
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Slimick said,
April 26, 2010 @ 4:06 pm
CCCS (Consumer Credit Counseling Services) negotiates reduced (or zero interest)…which can help a lot. They require you to cut up all your cards and stop using credit.
Debt consolidators give you one loan so you can consolidate all debt into one payment. FYI: Student loans cannot be discharged in a BK filing
*~Cam's Mommy ~* said,
April 26, 2010 @ 4:51 pm
We are in the same predicament. We’re about 40,000 in debt not including 2 car payments and I’m at a point now where I won’t be able to pay either. (I’ll save you my long story) Needless to say I contacted a credit counseling service and was told that since I have always paid on time my interest rates would be too good to benefit from the program. Now I have to scrounge up money for a payment or just not pay. It’s sad, but I’m at a point where my credit rating isn’t worth my happiness so I’ve almost stopped caring, at least on one of my payments that is 502 a month..
Credit Counselors will take all of your unsecured debts and get them at a lower rate. You pay them one payment each month and they distribute them to your creditors. I didn’t qualify b/c their payment would be more than my monthly minimums as of now. You may qualify, so it’s worth a shot.
Consolidation just takes all of the debt you have and puts it together for one easy payment to a lender who pays your debt off for you. This is what got us into trouble to start with. We consolidated and now our consolidation payment is too high for us to handle due to having a baby and a loss of a job. Our circumstances changed, they don’t care, they want their money.
We have seen a bankruptcy lawyer but we’re just waiting it all out to see what happens with everything. We DO NOT want to file and are trying to do all we can to contact creditors and get rates lowered etc. With our economy so bad, they aren’t budging.. so as of now, my credit is going to be shot.
I wish I could help you more but know you’re not alone and a lot of Americans are where we are..it’s sad
I wish you all of the luck in the world!!
bdancer222 said,
April 26, 2010 @ 5:30 pm
Here’s the link to find CCCS near you: http://www.nfcc.org/
This is a legit non-profit company that can look at all your finances and advise you how to proceed. They also have debt management programs if you qualify.
The last thing you need is debt consolidation. That just shifts all the smalller bills into one huge bill. And a lot of these companies are just scams.
pibzz said,
April 26, 2010 @ 5:52 pm
Be careful, the dirty little secret about credit counseling is that most are actually collection agencies.
They collect the debt for the bank, at usually pennies on the dollar, then turn around and get you to pay say 60 cents on the dollar, the difference is their profit.
Credit counselors do NOT work for free, and most make lots of money and are unscrupulous, so be very careful.
They promise you the moon but can’t always deliver.
Not all banks go along with the CCC program, and many will negotiate with you directly at a better rate, if you just ask.
There is no simple answer just be careful, and research the company you choose thoroughly.
Karli said,
April 26, 2010 @ 6:26 pm
Practically any type of loan can be wrapped into the debt consolidation process. Common types include finance charges, late fees and overdraft charges, credit cards, personal loans, utility bills, medical bills, car loans, store cards, gas cards and back taxes. A debt consolidation loan allows you to condense your monthly