What Will Debt Consolidation Do To My Credit? Possible Ramifications

What Will Debt Consolidation Do To My Credit? Possible Ramifications

Debt consolidation has received a negative image in recent years that it just doesn't deserve.

Many people believe that all consolidation firms are scams, but this simply isn't true. In fact, a few bad apples have spoiled the entire industry.

Aurora Lillo Editor of the "Best Debt Consolidation Services" website -- http://www.BestDebtConsolidationServices.net -- pointed out;

"...Rather, the truth is that if one takes the time to find a completely trustworthy firm, consolidation can do an enormous amount to improve one's credit and one's image in the eyes of debtors, beyond credit..."

First, debt consolidation is a foolproof process. Take out another loan. Use it to pay down your other red ink. Pay the low monthly fee every month. In about a year or maybe eighteen months all of one's debt is gone. The debt-to-income ratio is the single most important factor in a person's credit score, and debt consolidation can make that ratio zero. This alone can dramatically improve one's credit, especially since paying off the debt in such a program is so easy.

Furthermore, joining a consolidation program shows a person's creditors that he or she is responsible. This person is willing to do whatever it takes to pay off his or her responsibilities. He or she is not bothering to settle, and is not going to even consider bankruptcy. Rather, he or she is joining a consolidation program, that requires and can guarantee that every creditor will receive payment in full. this can mean a lot to a creditor.

The amount that one will owe under such a program is also very likely to be less than the amount that he or she would owe otherwise. This is because companies that offer debt settlement and consolidation deal primarily with people who are in some form of financial trouble and understand far better than other people what they are capable of paying. Interest rates are likely to be much lower than they have been originally. Many people even have begun to use such programs as a way to refinance, even when they don't necessarily need to do so.

"...And finally, this understanding of people in poor financial straights can lead to other benefits. Many consolidation organizations are willing to give out free credit counseling, which can help prepare someone for his or her financial future even after the consolidation program is complete. Many companies also will assist in settling with creditors whose accounts cannot be paid if necessary, as well as offer moral support. This is an indispensable part of one's financial life..." added A. Lillo.

Further information about trusted and reputable companies for debt consolidation by visiting; http://www.BestDebtConsolidationServices.net

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