Getting Out of Debt

No matter how someone got into debt, they all have one thing in common- a difficulty in paying what they owe, and a sense of being overwhelmed by their bills. Debt settlement and credit counseling, while they may sound similar, have a few major differences. These services help many of the same people, and we’re about to tell you who is best suited to which service.

If you are able to pay a bit more than the minimum payment on your credit cards, you may be able to settle credit card debt fast and easy. Debt settlement is intended for those who need a low payment each month, and credit counseling is for those who have a bit more to spare and just need a bit of help managing their finances.

If you don’t own your home and cannot qualify for a second mortgage or home equity loan, you will probably qualify for credit counseling. Debt management will ding your credit score but it is far less detrimental to your score than a debt settlement. If you can do so, you should take out a home equity loan to pay your debts because they offer lower interest and a more convenient payment plan.
If you are unsure of where to start, there are plenty of good credit card debt repayment calculators online.

If your credit score isn’t good enough to get a low interest home equity loan, or if you doubt your ability to make the payment each month, you may need credit counseling. And, just because you have an oustanding home equity loan that you are using to pay your debts, does not mean that you can’t rack up new debt. You will need to learn how to manage your money and credit counseling/debt management services will help you do just that.

This is by no means a complete guide to credit management, but if you use the information we’ve just provided you, you can figure out which kind of debt relief will be most able to help you. Even the best debt help won’t be able to help you if it doesn’t apply to your situation.