Unless you have been living in a cave your must be aware that we here in the USA are trapped in the midst of a horrible economic collapse. Needless to say this is causing severe loss to many people. There are an ever rising number of foreclosures in addition to high levels of job loss. To add insult to injury credit card debt is at an all time high. This is leaving millions of people in positions with their debt that is very difficult to deal with. Somewhere along the line people start thinkning about reaching out and getting some help with their debt situations when they come to the realization that there aren’t too many options available to them. The two most used of credit card debt relief programs are CCCS programs often times known as a credit card debt consolidation plan and credit card debt settlement occasionally referred to as credit card debt negotiation.
The two of these processes do have the capability to help people get out of debt much sooner than if they were to just remain on the credit card debt treadmill and pay monthly minimum payments. But both of these plans are very different from each other.
A consumer credit counseling program has very nice benefits; one being they can typically get the interest rates brought down. Another very nice part of this plan is that you will just make one monthly payment to the credit counseling company in which they disperse to your creditors on your behalf; thus making your life much easier with paying your bills. On average a consumer credit card debt counseling program can last anywhere from five to eight years to get out of debt.
Credit card debt negotiation is a much different sort of a process. For one you actually lower your debt not your interest rate. So you end up saving a lot of money, in most cases the debtor will see a savings of 50% or more from how much they owe the creditors. Another large difference from a consumer credit counseling plan is that you will become debt free much quicker with debt settlement, in most cases no more than two years. But there is one downfall, in order for the credit card companies to be in position to negotiate a debt settlement the credit card accounts must go past due; the credit card companies will not negotiate when you’re current. So this does have a negative effect on the credit report.
The damage done to the credit report is not permanent though and it will go back up towards the end of the credit card debt settlement program. For the vast majority of folks in credit card debt one of the two plans reviewd above will help. Those folks who have no problem paying their minimum payments on time should go for credit counseling; but those who have a large sum of debt and have a hard time paying it then debt negotiation would be a better method.
