Topdown Focused Retrieval System

Debt Consolidation

Once you know your goals and your options, as you try to become debt free, you need to decide what is the best option for you - Debt Consolidation or Debt Settlement

It is very important for you to understand the difference between:
1. Debt consolidation
2. Debt negotiation and debt settlement

Both debt consolidation and debt settlement have their advantages and disadvantages. Before you enter into a debt help program you must clearly understand what you are getting into and how it operates.

Compared to debt consolidation, debt settlement might seem more beneficial to you. In case of debt settlement you are actually negotiating with the creditors to give up a part of the money that they had lent to you and write it off as bad debt.

Although this might seem like a dream come true to a lot of us, but it has potential disadvantages associated with it:
1. It will show in your credit report for the next 7 years and beside the debt it would be listed that you "negotiated and settled" the debt.
2. Although this is a better option than having an outstanding debt amount in your credit report, in a way it is derogative. It will still send a signal to any future creditor that you have not paid back the total principal amount in the past.

So when should you go for debt consolidation and when should you go for debt settlement:
1. Consumers having outstanding balance with more than one creditor can potentially benefit from debt consolidation.
2. If you feel your debts are too high and there is no way you can ever repay those debts and will end up going in bankruptcy, in such cases debt settlement is the right choice for you.

Topdown Focused Retrieval System

The Topdown Focused Retrieval System starts with a general search term and refines your search at each level. Through step-wise refinement you will quickly reach the item you were searching for. It does the thinking for you. Just click on the item that best describes what you are looking for at each stage.

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