Debt Consolidation Versus Debt Negotiation
Debt consolidation versus debt negotiation, what is the difference and which is the best route to take? You are the only person who can answer this question. Debt consolidation versus debt negotiation each has its own benefits and drawbacks. Debt consolidation versus debt negotiation must start with a careful examination of your financial situation. You must decide what type of service you seek, what you can afford to pay and what the ultimate outcome will be to your credit report. Debt consolidation versus debt negotiation will be present differently depending on whom you talk to and what their preferences are.
Debt consolidation versus debt negotiation is argued by many people. Debt consolidation companies will take the view that debt consolidation versus debt negotiation is not really two different things. They can offer you both services. Not only will they consolidate your bills into one payment but they will negotiate with creditors for lower interest rates and cancellation of fees. They will assist you with consolidation and repayment of the debt but this is not truly debt negotiation. Debt consolidation versus debt negotiation really must draw a distinct line between the two types of services.
Debt consolidation versus debt negotiation when viewed from the negotiation side is something totally different. Debt negotiation involves bargaining with creditors for a smaller payoff amount. Most creditors are willing to settle for a reduced amount if the debt is paid in full. Debt negotiation services will work with you to find the middle ground. Debt negotiation can be a long process, taking as long as 6 months to a year. Once you determine what you can reasonably pay, the debt negotiation company will make a proposal for you to your creditors. You must have the money in the bank waiting when a settlement is reached as payment is needed immediately.
Debt consolidation versus debt negotiation will have different effects on your credit report. Debt negotiation may not repair your credit but it will show that you have paid the debt in full which can go a long way with future creditors. Debt consolidation is usually reflected on your credit report as being in debt counseling. Some creditors view this as a positive step, especially since timely payments are reestablished. They may remove all negative information once you have completed your debt consolidation program, but this varies by creditor.