debt consolidation agency VS counseling office.?
im in middle of choosing between ccc agency and credit counseling office. what is actual difference(good and bad) between these two? and which way is pay off debt faster??
Public Comments
- Consumer Credit Counseling Service is a highly reputable non-profit organization. There are many other credit counseling agencies that are not reputable, so go with CCCS or another agency that you're SURE is reputable. Credit counseling will negotiate your interest rates and set you up on payment plans with your creditors. You will pay one monthly payment to the agency, and they will pay your creditors monthly for you. You are still responsible for checking your statements and ensuring the agency is paying your creditors on time. If you are behind on your bills, counseling will bring them current. You will pay a service charge monthly which is included in your monthly lump sum payment, and the agency will receive a kickback percentage from your creditors for collecting their money for them, usually 4-11%. You will not be able to get a new credit card, loan, or mortgage very easily until the debt is paid off, as counseling shows on your credit report and may be treated by a lender as a form of bankruptcy. Debt consolidation usually means getting a new loan to pay off the other creditors, sometimes with a higher, sometimes with a lower interest rate. If you pay this new loan on time, your credit will improve faster than counseling. However, if one does not curb one's excessive use of credit, debt consolidation will not help change the behavior. It may be easy to wind up in the same situation again in the future if the behavior isn't changed with credit counseling helping now.
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