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Maybe you have already reached that breaking point, your debts are piling up left and right and you're trying to figure out what your options can be. You've looked into bankruptcy, credit counseling, debt settlement, and debt consolidation. On the radio and online you see ads left and right for debt consolidation loans for credit cards and you think this might be a good fit for your situation. But like anything, if it sounds too good to be true, it probably is. So there are some dangers need to know about with a debt consolidation loans. First consider your current situation, you are in debt and the solution proposed by loan consolidation experts is to take on more debt to pay off your debt, it doesn't make sense. Essentially you're digging another hole to try and get out of the other one. Most people who take debt consolidation loans realize all they are doing is delaying the problem not actually solving the debt issue at hand.
You have a problem and the solution is not to create more debt, but pay down the debt fast. It's really that simple. Hence your two best options are credit counseling and a debt settlement option.
First of all the credit counseling session with a well licensed and good broker can establish you with your creditors as someone who's taking serious your financial issue at hand. Many of these brokers have dealt with similar credit agencies that help you find the right path without adding any more debt for you to dig out of your hole.
But I know you've also seen ads and articles about debt settlement. What exactly is debt settlement and why might it be a good fit for you? Well essentially during a debt settlement process you start paying your monthly payment to the debt settlement company instead of your actual creditor. The reason that you do this is because the settlement agency will put that money in a savings account and then after a few months your creditors realizing that you are not only past due but have accumulated a great amount of debt are willing to settle your debt so they can recoup some of their money back. This agreement is mutually acceptable to both parties so both can move on. Certainly this is not without some drawbacks, the one being that for the month or two of nonpayment your credit score might take a small hit. However you must first consider the difference between a temporary hit in your credit versus declaring bankruptcy which essentially destroys your credit for years to come. There can also be damage done to your credit if you engage in a loan consolidation land because you're adding more debt to your already existing mountain of debt.
But I want you to be aware of the full experience of credit counseling and debt settlement. The only way that you can feel secure and moving forward in your financial future is by knowing that you're dealing with a reputable and licensed company that tells you both the good the bad and the ugly of all your different options. You must deal with a company willing to tell you the truth. We have to be honest with the situation, you are in debt in you need the right solution for you. By engaging in debt settlements you have the possibility of within a few months paying off your entire loan and moving on with your life. It's the option that most people should consider when dealing with their own personal financial crisis.