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• Interest rates can range from as low as 1.9% to as high as 30% and creditors can raise your rates at any time.
• You will pay close to 50% of your original balance in interest alone over the first 3 years. You are not making a dent on your principal balance.
• If your rates are 20% or higher, it is practically impossible to pay off your debt by making minimum payments unless you pay at least 3% of your total balance in minimum payments monthly. Even then, it would take you over 35 years of payments to be debt free.
• Even at lower rates, it will still take 20 to 40 years to pay off your debt with minimum payments and there will be little room for obtaining additional credit.
• If you have already stopped making payments, you are destroying your credit while not resolving any of your debt in the process.
• Both Chapter 7 and Chapter 13 bankruptcy will have a severe negative impact on your credit for 7-10 years.
• Can cost over $2,500 to file.
• May keep you from being hired by a perspective employer.
• In a Chapter 13 filing, you may end up paying 75 - 100% of your debt back.
• Chapter 7 is very difficult to qualify for under the new bankruptcy laws.
• May result in higher interest rates on future loans.
• Carries a negative stigma, mental & emotional stress, and other burdens.
• Bankruptcy should be your last resort.
• Chapter 13 completion rates average only 33%.
• These companies are paid by the credit card companies themselves. They do not have your best interest at heart.
• They are just another form of a collection agency, they act as a bill paying service of which a survey of credit counseling companies showed that the average interest rate charged is around 11%. Talk to one of our Debt Consultants to see what is the best option for you.
• They will consolidate your bills into one monthly payment and may lower interest rates.
• Your Balance will often take 3-7 years to pay down.
• You will pay over 25% of principal balance in interest fees over the first three years.
• You'll end up paying back your full balance plus interest.
• The overall fees of an average credit counseling program are equivalent to or greater than those of a debt settlement program.
• There will be a negative impact on your credit for 5 - 8 years.
• This is often viewed by lending institutions as similar to Chapter 13 Bankruptcy.
• The average completion rate of consumer credit counseling is approximately 26%.
• If you miss multiple payments you may be subject to paying back past interest at your old rates that you entered into the program with.
• Payments will not be tailored to your budget, they will be set by your creditors.
• Need to qualify for a new loan first, which is very unlikely with the current market.
• Requires ownership of Real Estate property.
• Home Equity loan reduces future equity available in your property.
• Consolidates your credit card balances, but makes unsecured debt now secured debt.
• Missing payments could cause you to lose your home or the collateral you pledged.
• A transaction fee is usually required upon closing or is built into the interest rates.
• Payback can be 15-30 years depending on debt balance and ability to pay back loan.
• You will pay back the full amount of credit card balances plus interest and spread over the term of the loan.
• Bottom line: You are exchanging your unsecured debts for a secured debt, a very big risk.
• Rapidly becoming the top method for consumers with financial hardships to get rid of unsecured debt.
• Companies are independent and do not work for your creditors, and thus, are working for your best interests. There are a few exceptions to this rule such as a company called Credit Assist, so be aware.
• Fees are spread out over time, usually 12-24 months depending on the length of the
program.
• Client's debt is paid off in anywhere from 18 - 36 months depending on cash availability.
• Will receive an 'open delinquency' on your credit until debts are settled.
• Lowers your debt to income ratio faster than Consumer Credit Counseling, which represents a significant factor in your ability to quality for a loan.
• A plan to settle your debt for less than the principal balance owed.
• Total cost of program may be significantly less than credit counseling for those that complete the program.
• Negative impact on your credit until debts are settled off.
REGAIN CONTROL OF YOUR FINANCIAL FUTURE NOW!
Before making this important decision, contact one of our Debt Consultants to explain our program. Call now for a free consultation 1-888-242-4289 or fill out the form on the right side of the page and a consultant will contact you within 24 hours.
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