America Debt Consolidation

Free Debt Consolidation
(why it's not too good to be true)

Although employing a debt consolidation expert at no cost to you may seem too good to be true, such programs do, in fact, exist. Non-profit credit counseling services do not require the consumer to pay a fee. Instead, they receive a “fair share distribution” of approximately 10% that is subsidized by the creditor. If a non-profit debt consolidation company asks a client to pay any fee it all, it will usually only amount to $5–$20 per debt monthly.

The creditor is willing to pay the debt consolidator because the consumer’s enrollment in a debt consolidation plan will ensure that the creditor will receive payment from the consolidation company. Creditors know their refusal to comply with a consolidation company’s terms can come at a great cost. From the creditors viewpoint, it is better for them to receive these payments—even at a reduced interest rate—than to have the debtor continue to be remiss in his payments, or resort to filing bankruptcy. Creditors would also prefer to avoid the legal fees involved in suing the debtor for repayment. Hiring a collection agency could prove costly as well. So, it is in the best interest of the creditor to subsidize a not-for-profit debt consolidation company, leaving the debtor free to apply your money towards monthly payments that go mainly towards your principal balance.

Of all parties involved, you, the debtor, will benefit most from the debt consolidation program. Your monthly payments will be reduced, as will your interest rates, so you will be able to pay off your debt much more quickly. Your credit card accounts will be closed so you can no longer use them to place yourself in further debt, and the accounts will be left in good standing. Your credit report will clearly reflect the advantages!