These days when more and more people are approaching some or the other debt consolidation company for consolidating their credit card and other unsecured debts, there has been a mushrooming of many debt consolidation companies. No doubt, there any numerous genuine companies who offer ethical debt consolidation programs and are interested in getting you out of the debt trap. But there are many operators who under the garb of a genuine debt consolidation company can add to your problems by charging you hefty fee and still doing nothing to get you out of the debt trap.
Types Of Debt Consolidation Companies
There are two types of debt consolidation companies that seek to help you with consolidating your loans and credit card bills. They are non-profit debt consolidation companies and for-profit debt consolidation companies. The non-profit debt consolidation companies are the ones that charge no fee or very nominal fee for offering debt consolidation credit counseling, budget planning and suggesting an appropriate debt consolidation loan to get you out of the debt trap.
These non-profit debt consolidation companies are supported by major card issuing companies and by the Federal Government. These companies have an objective of getting people out of the debt trap and to help people to avoid debt related stress. Generally, a non-profit debt consolidation company would hire the services of finance experts who help people to plan a budget and other counseling techniques to help people shun their dependency over credit card usage. These companies generally do not offer debt consolidation loans on their own and if they offer such loans, they are at a very reasonable rate of interest. However, the debt consolidation process by such companies could take some time because of the non-profit nature of these companies.
On the other hand, there are numerous commercial operations that employ ethical and genuine means to help people in consolidation of their loans and credit card bills. True, that these companies charge you a fee for offering debt consolidation counseling and other debt consolidation services but they are worth every penny spent because of the professional nature and fast services they offer. Moreover, the for-profit companies offer better debt negotiation and debt management skills, which means that they can get a substantial reduction in the amount due by your creditors, and help you to become debt free really fast.
Now it is for you to decide the type of organization you select for consolidating your debts. Whatever be the type of organization, please make sure to make appropriate enquires, run a creditability check and compare their fee and other charges carefully before making any payments to them. There are many unscrupulous operators who are working as a non-profit debt Consolidation Company, but their objective is to swindle unsuspecting people who are in a debt trap. It would be better to check with the local Better Bureau of Business (BBB) to check the creditability of the online debt consolidation companies. Remember, it is better to be safe than to be sorry. This becomes even more important when you are already reeling under the pressure of unmanageable debts.