Consolidating credit card reviews

Debt Consolidation Loan: While debt settlement and debt consolidation are used interchangeably by many in this industry, an actual debt consolidation loan is different from a debt settlement plan.

With a debt consolidation loan you get a loan to pay off your creditors and then only make payments to one lender, usually a bank or a credit union, though a few of the settlement companies in our review have a separate division that offers debt consolidation loans.

Before entering a debt settlement program, you’ll want to weigh some of the drawbacks and advantages.

The settlement companies we interviewed all offer flexibility in these situations, letting you divide your payment into monthly installments.By entering a debt settlement program, you agree to have the debt settlement company negotiate with creditors on your behalf.As part of this program, you’ll stop making payments to your creditors and begin making one monthly payment into an account set up by the settlement company.We spent another 20 hours interviewing these debt relief companies and conducting secret-shopper-style customer calls.All of the companies we included are transparent and upfront with customers about the risks associated with these programs and follow FTC regulations that prohibit advance fees.It’s likely that because you stop making payments, you’ll be assessed late fees and penalty interest rates.

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