Ime Ekpo
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Ime Ekpo in $ Financial Freedom Chasers,

Debt Settlement or Debt Consolidation?

We all get to the point where our lives are too busy to keep track of our debts. Most of the time you might actually neglect your debt because you know those interest rates and late fees are adding up every month. Yet it has been 5 years since your first payment. At this point, you have probably given up on trying to establish a clean financial record, so you are discouraged. This is where debt settlement and debt management programs come into play. 

These programs are designed to help people who have accumulated more debt than they can afford to pay back. These two strategies are very similar yet different. Overall participating in these programs will help manage your debts better and help you get out of debt as soon as possible. And of course, you will be able to save a lot of your money. Before you even consider options for handling your debt, it is important to have knowledge about their practices. 

In a debt consolidation program to pay off your debt, you take out a loan which will pay it off. This is a pretty covenient option because now your monthly finances are much more at ease, since you'll be paying a lower interest rate than you were paying on your previous loans. 

When it comes to debt settlement you will be working with a credit counselor or specialist. He/She will call all of your creditors to make negoitations on lowering your payments and rates low enough to be paid off, or considered paid off. With debt settlement you have got to come prepared. You will have to pay a bulk amount that is less than your total. Your debt will be considered paid off if your creditors accept your offer. 

What makes them different is that in debt settlement you will still owe the same creditors but just a less amount. The creditor has the ability to accept or reject your settlement offer. While in debt consolidation you wont owe your creditors but your status is still the same. You are still oweing someone money, which would be the consolidation program. But there is never a need to contact your creditors for any negoitation. 

Both debt consolidation and debt settlement programs have the ability to save you money. Debt settlement can help increase your financial status and debt cosolidation simply saves you on the interest rates. Regardless you are responsible for making the necessary payment commitments. Your debt isn't just going to go away because you are apart of a program. Always make sure you sign up with a high rated program. These specialists are simply individuals and have the ability to charge whatever they want to prospects, for the sake of their commission. Always make sure the deal is realistic and reasonable. Which program sounds the best for you?