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Your Credit Would Be Better With Consumer Credit Counseling

By: maria nellein

When you find yourself in a financial attach, you may have even missed a expense on one or more of your credit cards. Some people believe consumer credit counseling because they have heard that these services can help improve debt problems. But the question is are you sure that the best solution?

Once the consumer credit counseling (CCC) service business was conquered by the National Foundation for Credit Counseling, whose nonprofit affiliates negotiated lesser interest rates and payment plans for people who had fallen behind. But, increase in consumer debt in the 1990s spawned hundreds of competitors. Some of them do a good job of negotiating refund plans. And the others indict enormous upfront fees and pocket much of the money that should be going to pay off creditors.

Lydia Sermons-Ward, lecturer for the National Foundation for Credit Counseling, said that in debt repayment plans about half were predictable to successfully complete their plans. And the other half were predictable to drop out, with some of those filing for bankruptcy.

You have to know there are several other problems with consumer credit counseling services. For example, every credit card company will account you late even with CCC, and late payments lesser your credit scores. Credit companies report will settled for less and not paid as agreed for your accounts, if you?re going through a ?debt settlement? specialist, and the credit companies report settled for less and not paid as approved for your accounts. You may know, the worst trouble is that many home equity lenders, mortgage brokers and banks believe consumer credit counseling just like a bankruptcy.

But you can choose another way with combine your bills is by refinancing your high-interest credit cards and personal loans into a home equity loan (second mortgage). Actually the home equity loans offer lower interest rates than what you pay on your credit cards, especially if you are paying universal default rates. If you?re one day late on any payment to any creditor, Gerri Detweiler, author of The Ultimate Credit Handbook said that you could be subject to a default rate as high as 29.99 percent on many others.

As an alternative of taking these chances, you should take benefit of today?s lowered interest rate and get a home equity loan. That will make you not only get portion of mind knowing that your past-due debts are paid, but you will also enjoy lower monthly payments and up to 100% tax deductibility on the interest you pay on your new second mortgage loan.

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