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08-12-2008 at 1:57 PM
Angelofmusic1230
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Joined on 04-16-2008
Alburtis, PA
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Angelofmusic1230 is not online. Last active: 12-03-2008, 3:39 PMNewbie

Debt Consolidation

I'm sure this is asked more often on this board but i paged back a few pages and didn't see anything....

What is your opinion on Debt Consolidation? have you done it? what company did you use?


 
08-12-2008 at 2:04 PM
Just_Ali
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Joined on 10-20-2007
San Diego, CA
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Just_Ali is not online. Last active: 12-04-2008, 5:26 PMSilver
I haven't done it, but my thought on this is (and I have a lot of debt) is that IF you are able to do it on your own you are better off doing it on your own.  I would use one ONLY as a last resort.

 
08-12-2008 at 2:08 PM
busygal
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Chicago, IL
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busygal is not online. Last active: 12-04-2008, 4:25 PMBronze

I replied on the 2nd tri board, but agree with PP.  A debt consolidation company typically goes on your credit report like a bankruptcy.  So you should try to work out deals with your creditors individually first.

GL! 


 
08-12-2008 at 2:12 PM
justinandjen
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Indianapolis, IN
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justinandjen is not online. Last active: 11-26-2008, 7:50 PMNewbie

I would avoid them. The only way to pay off debt is to live on less than what you make, and then throw the rest at your debt. You don't need someone to do this for you. Plus, these companies will show up on your credit report and will count as a negative when you go to get future debt.

Get a second job or sell some stuff instead.


Jen and Justin

10.18.2008
 
08-12-2008 at 2:12 PM
cif8
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Live in Texas; wedding was in Winston-Salem, NC
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The short answer from me is yes, I've done it and it works for me.  I use Consumer Credit Counseling Service, which Suze Orman recommends.  Their national website is www.nfcc.org, which you can use to find an agency in your area.

I was in a situation (due to a lot of factors) where I was unable to pay even the minimum amount on my cards.  My counselor sat down with me and made a very realistic budget and we came up with an amount I could afford to pay per month.  He negotiated with the credit cards to get to an interest rate and monthly payment that would fit with that amount.  I pay CCCS every month and they disburse the funds to the companies. 

I keep on top of my statements from the credit card companies (which I still receive) and my statement from CCCS to make sure that the payments are matching up.  It's a huge relief to me not to be dealing with collection calls and fear that I won't be able to pay my bills. 

When I checked my credit reports last year, the main designation on the accounts was "pays as agreed."  One of them had a note that I was in counseling.  According to what I was told by CCCS, the fact that I'm using them can not affect my credit score.  Once I have everything paid off, I can go to CCCS for help in getting a new credit card (which I will, of course, use responsibly!), a mortgage, etc.

If you can make the debt snowball method work for you, I think that's probably the way to go.  But, if you are like me and your budget is bare bones and there's still not enough to pay the minimums then I think counseling is a sound alternative!

08-12-2008 at 2:17 PM
dvlish
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Sunny So Cal
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dvlish is not online. Last active: 12-04-2008, 3:17 PMBronze
my sister did it as a last resort and when she still couldnt make the min payment went to my dad for help, by then it was too late.  a year later she had to file BK to get out of the hole she was in...not the choice I would have made but whatever, that was her deal.  i dont know who she used but knowing that it didnt do what she needed it to do i would avoid it at all costs...i agree that doing it on your own is the best option.  i have heard many horror stories here of those companys making your credit worse by paying your bills late, etc.

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08-12-2008 at 2:18 PM
kristisd
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kristisd is not online. Last active: 09-11-2008, 6:53 PMNewbie
Most debt consolidation companies are shady and prey on people with poor financial management skills.  The only one I would recommend is Consumer Credit Counseling, as pp mentioned.  They can help you get a handle on your debts and set up a repayment plan.  Ultimately, however, you have to spend less than you make.  GL.
 
08-12-2008 at 2:53 PM
ses1199
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San Diego
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ses1199 is not online. Last active: 12-04-2008, 6:49 PMBronze

I did this about 8 years ago.  I had maxed out all of my credit cards and had no way of paying them off.  I was young and stupid and made bad choices.  I did not know what to do and so I called a company named "In Charge Solutions".  They were able to consolidate all of my credit card debt and I made one payment to them per month.   It took me about six years to pay it all back but I did pay it all back.  I know it cost me more to go through them, however I was at my wits end and I needed one lump payment.  I could not keep up with everything.  I could not use credit cards during this time and it also really tought me how to live life without credit.  (Something I should have known, I know.)  Anyways, my DH just ran my credit because I have now been out of the program for two years and my score is 746. 

In my opinion it was the best option for me.  I'm sure it is not for everyone but it was for me. 



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08-12-2008 at 2:57 PM
Emmybean
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Joined on 05-13-2004
South Sound
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Emmybean is online. Last active: 12-04-2008, 7:42 PMSilver
I have been through it. At the time I was not very educated about my options and just needed to get my payments lower. I lucked out and got a good company (I literally did no research and just picked one at random). There is no note of the consolidation on my credit reports. It worked well for me, but looking back, I could have done it myself (probably, I may not have gotten as good of rates from creditors though) and might have been able to get it done sooner without them. I used Kimberly Credit.
08-12-2008 at 2:59 PM
sam&val
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Denver
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sam&val is not online. Last active: 12-04-2008, 1:55 PMBronze

I'm just a lurker on this board, but like pp, I'm in a debt management plan with CCCS. Also like pp, I got to a place where, even with our budget as stripped as we could get it, I couldn't make the minimum payments on my cc's each month. I've only been in the plan for about a month, but the people I've worked with have been wonderful.

I would only recommend it as a last resort. If you're in a position where you can do it on your own, do it! But if you feel this is the right path for you, definitely go with CCCS. One nice thing about them, is that they only want to help you - they don't judge. (Which was something I was very concerned about.)  


 

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