Credit Counseling Vs. Debt Settlement

Credit counseling or debt settlement?

Although Franklin Debt Relief naturally supports the interests of debt counseling about credit counseling, it is also clear to us that it is not possible to explain which program is better because it depends on a number of different variables from each person. This article identifies the factors that you need to consider before choosing the right option.

1. What are you capable of? 
Credit counseling programs are far more expensive than debt settlement programs. The reason is simple: credit counseling only results in interest rates, while debt settlement can actually negotiate the amount you have to pay. Simply put, if you are truly financially involved, you must choose debt payment. On the basis of pure "deposits", debt settlement is almost always the answer. Although this is undoubtedly an important factor, it is not the only variable to consider before deciding which program is best for you.

2. What types of credit can you use?
Some credit counselors will definitely promote that their program does not have a negative impact on your credit rating. This is a play on words. Of course, your score won't fall, but ask each creditor about the impact on your loan application. Let me save time - it's devastating. That said, debt settlement is no better for your loan, and the overall creditor is clearly not like a debtor who is looking for outside help for their financial situation. On the other hand, they clearly do not like the record signs that are ignored in the settlement program.

Let's look at this example: Four years ago, John decided to seek credit counseling and Mary decided to follow the path to fulfillment of obligations. Both have the same income and costs and both apply for a $ 200,000 mortgage. Who will get it - John, who is a year before completing his credit counseling program, or Mary, who completed his debt settlement program one and a half years ago and has since recovered his credit? Although this can range from creditors to creditors, Mary is generally considered a better loan for candidates.

What if John pays a lot a month and both complete their respective programs at the same time? A loan counseling program would be better for your own loan, but if Mary might be able to make more savings with upfront payments, she might still be considered a better borrower. Do I think it's fair? Not at all funny is that creditors are very hard on customers for credit counseling programs. Unfortunately, the system is wrong, but until the correction is made, the debt consolidation client will be able to get a new loan after completing the program.

3. Who do you owe?
So you can save more money when paying off debt, but not always. If you owe a more aggressive lender like Citibank, credit counseling or bankruptcy can be a better choice for you. The reason: Citibank not only wants to satisfy more, but also takes legal action to collect debt. Although debt settlement still works for most creditors, dealing with Citibank is a far more risky job. If you can't afford your credit counseling and your debt is fully with Citibank, you might be better off going bankrupt.

4. What is your personality type?
I have read almost every article on the internet about credit counseling versus debt settlement, and I wonder how most financial writers get rid of human elements from this discussion. The bottom line: debt settlement is not for people with weak hearts.

There is no certification that everything will work out as expected.Some settlements may be higher than expected. Some settlements may be lower than expected. You will definitely receive several creditor calls. This is the nature of this program and you must be willing to accept the level of uncertainty before registering.

I have arranged the following 4 questions in this order. If you can't afford credit counseling, it's almost impossible for you. I don't want that to sound too cynical, but we live in a material world, and subjects like fearful people must be sacrificed if you don't have the money to freely practice aspects of your character. On the other hand, if you have 100% of Citibank's debt, it would be foolish to choose a debt settlement or settle a bankruptcy debt just because you think you are a risk carrier.

There are many other variables that influence whether debt settlement or credit counseling is right for you (i.e., the state where you live, what source of income, etc.). It is best to discuss your personal situation with someone who is knowledgeable about these fields.

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