Credit Card Debt Services: Do You Really Need One?
Credit card debt services are everyplace. They are cropping up on TV, on the radio on billboards, in our email. The world is in debt. Going into debt is an avoidable state of affairs and there is always a solution that we can use to recuperate from it. We can for sure look for some help from credit card debt services. I know I write about this a lot, but it’s important to constantly repeat the mantra, BE CAREFUL! These services are designed to offer solutions to help people recover and become debt free, but many do absolutely nothing and charge thousands of dollars for something that you can do yourself with a little education and persistence.
Debt services if chosen properly are a valuable resource, that can provide you with a plan and the proper program to follow to get you out of debt fairly rapidly. These services can also increase your credit score, although this can take time.
These services are not cheap. Credit card debt services usually charge a set fee plus a percent of the debt that they settle for you. The fee can be as high as 25 percent. So if the fixed charge is 1500 dollars, and you have 10,000 dollars in debt - you could end up paying more than 4 thousand dollars to settle it. Money that you could have used to pay off you debt if you had chosen to conduct the settlement yourself.
Now, heres the kicker. If you are already behind in your debt, many credit card companies already have a settlement program in place. What some credit card debt services will do is call the company and accept the initial offer. So they end up charging you a lot of money for making a phone call that you could have made! Good deal huh - well, for them anyway.
Credit card debt services can help. And there are some good ones out there. But make sure you get some references. A reputable company will be glad to give you references of people who have used their services.
There are several guaranteed loan programs available. If you are not already behind, you may be able to use one of these programs to pay off any high interest credit card debt - destroy the cards! and then pay off the loan as quickly as possible. If you are already behind, you can still use these guaranteed loan programs.
Some credit card debt services can consolidate your debt without a loan. They actually act as a broker of sorts. They negotiate with your creditors, and they you make a single payment to the settlement company, and they distribute the money to your creditors. Be very careful of these services. In many cases they just accept the first offer, which may not be the best offer. In many cases they don’t pay the creditors as agreed, and the collection calls continue. Most of these companies will make sure they get paid first. So the money your paying will probably pay the settlement company before it pays your other creditors.
Why Should You Use Credit Card Debt Services?
• One reason is the high cost of maintaining credit card debt. Fees and interest can mean that simple purchases drag on for years and cost far more than they would have with cash. In many cases the minimum payment grows to the point that it is hard to keep up with.
• If the debt isn’t taken care of, bankruptcy may end up being the outcome. Credit card debt services can help you avoid bankruptcy.
• Debt services can help you “get right” with your creditors, and possibly improve your credit rating ultimately. Although, quite honestly, anything other than paying your debt on time and in full will result in an initial decrease in your credit standing.
• Not being sure of how to navigate the credit system, or what the laws are. What are your “debt rights” involving consumer credit, legal rights and debt liability?
I can’t tell you whether or not you should consult with a credit card debt services provider. Only you know your financial situation. But you should always know your credit rights involving debt. Legal options are available.
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