Benefits of Non-profit Debt Consolidation Services

Call the hospital and see if they have any programs that can help. Last month when I ended up in the ER with my gallbladder we got put on a payment plan where we only pay off $28 a month until the bill is gone. The surgeons office also worked out a plan where we actually only have to pay half of what the bill would have been (because my dingbat husband cancled our health insurance back in May *smacks head against wall*).

If you have facebook, there is a group with 200+ thousand members called: “Cancel Student Loan Debt to Stimulate the Economy”

There is also a petition which you can find there.

Hi, Jimmy:

First, I already answered a related question, so I've copied that answer below after the dashes.

If your number one objective is to simply improve your credit, you could just wait it out for another 2 years until the debt is 7 years old. You can then ask for it to be removed from your credit report. If this is your objective, then don't pay the debt. Records on your credit report are good from 7 years of last transaction so any payments or charges you make resets that 7-year clock.

Personally, I've never used a debt consolidation company because I've felt capable of trying the same tactics myself. Granted, these companies are professionals and may get special "deals" and privileges that I wouldn't get, but I've still been pretty pleased with my own results.

Before using a debt consolidation company, I recommend trying your own hand at it. Contact your creditors. Before you do, determine how much you can afford to pay in a monthly payment. Even better, if you have some money saved up as a lump sum, you can try to pay them off in a couple of chunks. The more money you can give them at once, the better your negotiating power.

If you're in collections, ask the creditors by how much they'll reduce the total amount owed if you pay now/in 30 days/in 60 days/within a year.

If you're not in collections yet, ask the creditors how much they'll reduce your total interest. Some companies (e.g. Discover used to do this) will even suspend interest entirely while you're in re-payment. Of course, you can't use the credit card during that time, but you're saving money and salvaging your credit.

Good luck!
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There are several benefits to credit card consolidation:
- Convenience (only one or two payments)
- Easier to manage (less likely to forget a bill!)
- Possibly a lower combined interest rate

Generally, when companies help you by consolidating your credit cards, they contact the credit card companies on your behalf and try to negotiate a lower interest rate (you can do this on your own, by the way). Then, the companies can take one of several methods for that single consolidated payment. Options include…
- Financing your debt themselves and then THEY pay your creditors
- Helping you find a financier to consolidate your debt
- Having you roll all of your debt under one of your existing accounts and pay off the others

As such, credit card consolidation does not affect your credit rating. In fact, the results of consolidation are often positive simply because it's easier to manage and you may pay less interest.

All this being said, I've never used a consolidation agency because I never wanted to pay the fees. Instead, I contacted my creditors myself and asked for the best possible interest rate they could give me, and asked what kind of arrangements I could make to manage debt. In general, they all worked with me.

By the way, here's one thing to consider when paying off your debt: Bad credit falls off your credit report 7-10 years after your last transaction. So, if you have a liability that is 6 years and 10 months old, carefully consider whether you pay it off or not. If you touch that account at all, even if it's to pay it off, suddenly that 7-year period is renewed. So, the choice you have to make is: Do you want something that was bad and is now paid on your credit report for another 7 years, or do you just want it gone entirely?

There are some ethical questions there, too (e.g. if the debt was yours and you were above 18 at the time, you should pay the debt to be ethical). These are questions that only you can answer. But, when working with a consolidation company, make sure they only consolidate the accounts you want them to touch.

Good luck.

I would suggest not going through a debt consolidation company because there are many bad ones out there. Plus borrowing money to pay off your loans to get one payment is like "Borrowing from Peter to pay Paul" as my grandparents told me once. If you do a search on the internet, many of the loan consolidation companies are listed on Rip Off Reports website.

Here is some advice to do this on your own. With only $6,000 in debt, you should be able to do this fairly quick. Others are using the same method with over $100,000 in debt. It works.

First thing of course would be to cut up the credit cards and make a commitment to never charge again. Then follow the following plan.

Make a list all your debts by amount you owe from smallest to largest. Then begin by paying the "most" amount you can each month to the smallest debt with the idea of paying it off quick. Then, only pay the minimum payment on the larger debts. Continue doing this every month until you have the smallest one paid off. Everytime you pay off a debt, call the company and tell them to close the account … that you paid off the debt and that you do not want to leave the account open. They will try to talk you into leaving the account open. Don't do this as it is too convenient and you will be tempted and will sink into debt again. You then start paying the most you can on the next smallest debt in line and go on from there until you have each paid off. Every time you get any extra money, whether it be $5, $10 or more, apply it against your debt even if you have already sent in a payment. You can send in payments more than once a month. Don't go out to eat. It's "beans and rice, rice and beans" as Dave Ramsey always says which just means (cheap meals that you can fix at home). LOL Also do things to make money like garage sales, sell on eBay, get a second job, anything to help you get money to apply toward that debt. It's not about obtaining the best credit score, it's about eliminating the debt.

You can get more help on how to accomplish this by reading and listening to Dave Ramsey. He has a talk show which you can hear on line through his archives, or live on line, or by radio by entering your zip code and find out what time of day his show airs. Plus there is a lot of reading material on his site to get you started. In addition, he has forums from his site to get help and advice from other people who are in debt. Dave has been there (with debt) and knows what it is like and is now helping people to get out of it. There are people that have followed this method with over $100,000 in debt and have gotten it paid off without going through bankruptcy and without getting some debt help company to do it for them. Dave's website link is below. I would also consider getting his book if you can. I gave mine away a few days ago to someone else on Yahoo Answers who is trying to do the same thing. It is worth the money and not that much, but you can obtain much information just by reading his site, going into his forums (there is a free trial offer) and listening to him on air.

I hope this information helps you and you get the relief you need. Best of wishes to you.

http://www.daveramsey.com

They are ALL SCAMS. Don't get ripped off.

Go see a local non-profit debt counselor. They will elp you with a budget and help you work with the creditors. No fast easy fixed.