What It Does
A debt consolidation company helps individuals and companies straighten their finances by managing their debt repayments. They provide a semblance of relief from heavy interests that accumulate over the years.
When you get the services of a debt consolidation company, make a checklist of important things that they should do for you. The first thing they should do is provide you with a dedicated debt counselor who will review all your debt records.
You do not need to consolidate all your debts. The counselor must be able to
help you distinguish between secured and unsecured debts. Unsecured debts like
credit card bills are the ones that you need to deal with. You may leave secured
debts like auto loans and house mortgages to run their course since you need to
maintain a record of credit.
This record or credit history determines your credit rate score, which loan
facilities look at when you apply for a loan. Consolidation should not harm your
A good counsellor also knows that you still need to maintain credit cards for your travel and business needs. He or she should not advise you against keeping them. What the counselor should do is lay down a more practical and convenient repayment schedules for you. This can be arranged with your credit card company. The debt consolidator must have a strong network with these financial institutions to provide this kind of service.
Non-profit and for Profit Debt Consolidators
There is a debate over the efficiency of two kinds of debt consolidators: those that operate for profit and those that claim to be non-profit organizations. But whichever you choose, keep in mind that the best debt consolidator is the one who is most able to chart a good plan to eliminate burdensome debts.