There are different forms of debt consolidation and debt relief. The option that is right for you will depend on your financial situation and your goals. Texas has some of the highest credit card debt per resident when compared to other states. There is no question that many El Paso residents are struggling with high-interest debt and need to consider Debt Relief in El Paso.
Debt Consolidation Loans
If you are not in financial hardship, have excellent credit scores and good income, this might be your best solution to resolve high-interest credit card debt. Most El Paso banks and credit unions will offer them, but you will increase your chance of qualifying if you shop as many lenders as possible in one application. Use affordabledebtconsolidation.com to receive offers from up to 25 or more lenders who provide Debt Consolidation Loans in El Paso, Texas. There is no fee for this service, and applying will not affect your credit score in any way.
Credit Counseling Debt Consolidation
You have probably heard the term credit counseling but may not understand what it is. These programs do not require a good credit score and don’t save money in a forgiven debt. However, it will consolidate your outstanding payments into a single monthly payment. It can also help you save money through significantly lower interest rates. This strategy can be a suitable approach to resolving credit card debt and some personal loans. The payment could be lower compared to making minimum payments, and it will provide an opportunity to resolve the debt in five years or less. If this would benefit you, consider Credit Counseling in El Paso.
Debt Relief with Debt Settlement
While credit counseling can provide significant help, consider Debt Relief in El Paso using debt settlement if you need to save more money. This is a hardship program, so like credit counseling, you will not be able to continue charging on the cards. The primary difference is your enrolled accounts will not be paid every month. Instead, you will accrue funds into a Special Purpose Settlement Account, and each account will be negotiated and settled using these funds. While there are advantages and disadvantages between settlement and credit counseling, debtsettlement will benefit froma lower monthly cost and the ability to resolve debt in as little as 24 to 48 months.
Pros and Cons of Debt Settlement and Credit Counseling
Both debt settlement and Credit Counseling in El Paso,Texas, have specific benefits and drawbacks. For instance, debt settlement lets you save money on your balance, as well as the future interest you don’t have to pay. Similarly, credit counseling may have less credit score impact but may cost a lot more. If your credit score is already suffering, then debt settlement might be the fastest way to eliminate debt and rebuild your credit score.
Also, creditors usually pre-approve counseling plans. You won’t have to worry about getting sued when you work through the plan. However, the problem with settlement is that a creditor won’t pre-approve a program, which means there will always be a possibility of a creditor using the court system to collect a debt. A reputable debt settlement company will be prepared to handle this for you or utilize an attorney to assist. Counseling isn’t without pitfalls, either. If you withdraw from a credit counseling plan, you may lose all of your benefits. Even missing a couple of payments could be a big problem.
The Bottom Line
If you have perfect credit and a good income, debt consolidation loans will be your best option in most cases. Credit counseling and debt settlement are hardship programs, so the program you decide to use shoulddepend on your situation and goals. With either hardship program, you will want to avoid using credit until you have resolved all of your debt. Generally, a settlement program will be more affordable and may allow you to resolve debt quicker, but credit counseling may provide enough relief.