Credit Card Debt Consolidation Or Debt Settlement? Know The Winner

Feb. 24, 2010 - PRLog -- Let’s look at both and decide which is better for you.

What Is Debt Settlement?

Debt settlement is when you or your representative from a debt relief agency call up the charge card company to renegotiate for a loan agreement.

Aurora Lillo Editor of the "Credit Card Debt Settlement" website -- http://www.CreditCardDebtSettlementUsa.com -- pointed out;


“…This process usually involves the following steps: …

1. Calling up the charge card company, asking for the manager of the settlement department, and asking to renegotiate your previous loan agreement …”

2. Telling this manager about your financial predicament in some detail, then asking for some type of concession on your payment agreement until you can resolve your personal crisis. Your requests can include asking for a lower interest rate, asking for a temporary hold on your interest completely until you can catch up on your payments, or asking for a discounted total amount.

3. If this manager is not willing to compromise in any way, then you show you mean business by quitting making all payments. However, you now begin sending money previously designated for payments into a savings account.

4. After a period of from three months to six months, after the collection agencies have failed to make any progress in intimidating you, you open up the negotiations. By now, your creditors are willing to accept anything rather than nothing, so you now pay off the amount in your savings account in lieu of the previous total amount.

What is Consolidation?

“…Debt consolidation is getting a loan to pay off your other loans, including all your credit cards, reducing all balances to zero.

Here are the typical characteristics of this type of loan.

1. It is a low interest loan designed to pay off high interest revolving card debts…” added A. Lillo.

2. It can be either offered as a secured or unsecured loan. If a loan is secured with collateral, it will be offered at lower interest.

3. This loan is obtainable if you have steady income and meet the minimum qualifications. A bad credit status is not part of the criteria for qualifications.

4. This loan will reduce all balances to zero on charge cards and the creditor will have to mark your credit scores as “paid as agreed.”

Know The Winner

If you have a choice, the Credit Card Loan Consolidation Program is better because you not only pay your creditor off in full but you also raise your credit score. It is also easier to apply, simply pay off the charge cards and move on with your life.

Further Information By Visiting; http://www.CreditCardDebtSettlementUsa.com