Consumer Credit Counseling Services Vs Debt Negotiation - Which Option is Best For You?
It is important to note that consumer credit counseling services are also an option that you can take in relation to successful settlement of debt.
This is one area which people usually do not give much attention to as they have the option of debt negotiation with them.
But, it can also prove to be advantageous for you taking into account the nature of your financial problem.
Now, what usually happens in these services or rather how can these counseling sessions help you out? Now, the first thing that the counselors do is go into a freewheeling chat with you in order to know where exactly you stand in relation to the problem of dues.
Once they understand that you are really not in a position to pay back, they devise an alternative plan with the help of which you can repay the total amount without really losing sleep over high interest rates.
Mostly, they take the route of reducing the rate of interest every month so that you can easily manage it and actually pay the whole amount taking your own sweet time.
In debt negotiation, you also get a similar relief from your monetary problems but there is an added incentive.
The amount that you have to eventually pay in order to settle the deal is much lesser than the original amount.
This is because you get to enjoy a considerable waiver in this method of settlement.
If you consider this factor, settlement programs do seem like a better choice.
After all, in a counseling program, you cannot run away or avoid paying back in full at the end of the day.
However, in a negotiation program, you get that liberty.
If there is any negative factor about a settlement program, it is the fact that it does have an adverse impact on the credit report.
The credit score is definitely at risk in such a scenario.
But, you should take into account the amount of convenience it offers.
If you analyze all the aspects, a low credit score will not seem like a big thing and you can easily make this one small sacrifice.
Also, you can always improve the score in the future.
Therefore, if you have to make a choice between the two, you know which one to choose.
This is one area which people usually do not give much attention to as they have the option of debt negotiation with them.
But, it can also prove to be advantageous for you taking into account the nature of your financial problem.
Now, what usually happens in these services or rather how can these counseling sessions help you out? Now, the first thing that the counselors do is go into a freewheeling chat with you in order to know where exactly you stand in relation to the problem of dues.
Once they understand that you are really not in a position to pay back, they devise an alternative plan with the help of which you can repay the total amount without really losing sleep over high interest rates.
Mostly, they take the route of reducing the rate of interest every month so that you can easily manage it and actually pay the whole amount taking your own sweet time.
In debt negotiation, you also get a similar relief from your monetary problems but there is an added incentive.
The amount that you have to eventually pay in order to settle the deal is much lesser than the original amount.
This is because you get to enjoy a considerable waiver in this method of settlement.
If you consider this factor, settlement programs do seem like a better choice.
After all, in a counseling program, you cannot run away or avoid paying back in full at the end of the day.
However, in a negotiation program, you get that liberty.
If there is any negative factor about a settlement program, it is the fact that it does have an adverse impact on the credit report.
The credit score is definitely at risk in such a scenario.
But, you should take into account the amount of convenience it offers.
If you analyze all the aspects, a low credit score will not seem like a big thing and you can easily make this one small sacrifice.
Also, you can always improve the score in the future.
Therefore, if you have to make a choice between the two, you know which one to choose.