Help consolidating medical bills
Debt Settlement Plan: Debt Settlement, also known as Debt Relief, is a service where a debt settlement companies withdraw a predetermined amount from your bank account each month that they put into escrow for you.Please note that an individual can settle his/her debt on their own as well. They then negotiate with your creditors to reduce your overall debt amount, and use the money they have been saving up for you to pay off that debt.Payday Loans & Title Loans: These are a loan of last resort.The rates are so high that it almost never makes sense to use these as options for getting yourself out of debt..Debt Management Plan: These are offered by nonprofit organizations that help consolidate and then renegotiate your interest rates with your creditors.This option can be an alternative to debt settlement.
Some types of debt are better suited for consolidation than others.Mortgage – Mortgages are considered secured loans, which means that the bank is using your house as collateral for giving you the loan.If you don’t make your monthly payments, then they repossess your house.They usually charge a monthly fee, legally it can’t be over a month, but most run around a month.Pros: They have minimal impact on your credit score Cons: Their program lengths can run for 5 years, which means you can easily have paid 00 in fees before you’re done Recommendation: You can use these if you don’t have a lot of debt and you can be quickly in and out of the program.
We wrote an article estimating debt settlement credit score impact.