Credit card debt and paying it off I keep getting flyers in the mail to get a debt consolidation loan for say 3.77% for $40000 dollars and you call them and all they do is say well you pay so much a month for 3 or 4 years and they talk your creditors into accepting less than full payment This seems like it hurts your credit score which they say not
Am I better off just taken my credit card bills and using the 3-year amount too pay them off and not charge anything to them to pay them off in 3 years instead of their method?
It sounds like you are getting offers in the mail for a debt consolidation loan but when you call you are being pitched a debt settlement program. This appears the latest marketing ploy to get people to call in.
I’ve been told the salesperson will ask you for information, say they need to send it for approval, and then come back and say you did not qualify but they have an even better solution.
My primary concern is you understand what it sounds like you are being asked to sign up for is not a loan.
You might want to read Debt Settlement Pros and Cons. My No BS Guide to Settling Your Debt.
You can also use my online Get Out of Debt Calculator to review your options.
The best course of action really depends on your individual circumstances and situation. Debt problems are like fingerprints, no two are the same.
If your credit score is the most important consideration then paying your debt off in full would be the safest course of action. However, if you are just limping along and can’t afford to save for an emergency fund or retirement then an alternative path can make logical sense.
If you want to go with whatever company is pitching you then read my free guides below.
- The Ultimate Consumer Guide to Checking Out a Debt Relief Company Before You Sign On the Line
- How to Check Out a Business or Company to Avoid Getting Scammed or Ripped Off
However, the wisest first step would be to sense check your situation and what you are looking to do by talking to an independent debt coach like my friend Damon Day. Damon can give you an overall assessment of how to best achieve your goals based on your current financial situation.
It’s like talking to a medical specialist to get a second opinion and then with a plan in hand you can decide who you want to work with.
Post an update in the comments below and let me know what you decide to do.