Consolidating Debt - Frauds In Debt Consolidation

Settle Debt Faster. Low Interest Rates - that is the publicity.

The fact is that actually the debt consolidation company benefits from this one. They buy - yes buy - a lower interest rate from the company you owe money to by negotiating settlement of thousands of dollars of debt. You are charged a fee for this facility and a monthly fee then.

The debt consolidation supplier pays off your loan faster, you don't. You keep paying them in its place.

If you thought making regular repayments by your due date was expensive, try making ONE LOW Payment monthly.

These companies only buy bad debt to lower the interest. They will buy sets of debt - thousands of dollars of debt from a company to get the lower interest rate - as well as they get a percentage kickback from your financing company to reward themselves for payment of that balance due.

Debt consolidation scam fees are built into your monthly payment - So literally you pay as much as you might have if you had sent that extra payment to your credit company and paid off your higher interest rate credit card faster by adding that additional fee to your payment monthly. Actually, you pay extra.

They don't re-negotiate your due date. That means that they pay everyone's debt at the same time, once a month.

If they pay on the 15th of the month and your payment was payable on the first, then your credit will get a 30-day late payment once a month - every month-on all three of your credit reports. Late payments remain on your credit history for 7 years (or longer). Feeling good now, I'll bet!

That's only a few. You could also be one of those persons whose payments get skipped once in a while - Yes it happens all the time with Debt Consolidation procedures.

Negotiation is something you can do by yourself. If you just hate talking to these people you can even authorize someone you know and trust to reconcile a lower interest rate for you on your behalf. If you can't get anywhere negotiating with the very first person you talk to, ask to talk to a higher authority. If you can't get anywhere by the third supervisor, you're caught.

- Negotiate your own lower Interest rate

- Stretch your repayment schedule

- Pay off the maximum interest debts First and add extra money

- Write 2 checks: One for the minimum payment and One for any additional money with a mention in the memo that says: "Principal Only Payment." This one simple action can save you tons of money. If you don't mention this, your money is automatically used to the interest and you'll pay more interest for a longer period. Yeah, that really sucks, certainly not for them. For you.

- Figure out - there are cost-free debt calculators all over the internet - what it would take to pay off your highest interest cards first. I plugged in my own and came up with the fact that if I add $60 a month to my minimum credit card bill, I can have a $1300 debt paid in 12 months with $66 interest.

- If I proceed with the minimum payment, It can take longer than 6 years and cost me over $2500. Actually that one action that I took put over $1134 back in my pocket - in one year. And I did it myself. Without debt consolidation charges!

I don't recommend any debt consolidation company. They prey on your despair and the doom and gloom of the length of paying back your credit cards at minimum payments.

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