How to Choose a Reliable Debt Consolidation Partner

debt consolidation

Financial advisors recommend you clear your outstanding debts on priority. However, when you lack sufficient funds by way of savings in the first place, implementing this advice becomes challenging. 

You land up paying only the minimum amount due against your credit card rather than the entire debt. Struggling with staggering interest rates makes life even more stressful. Consider a debt consolidation loan that helps lighten your debt load.

Using this loan facility, you can manage your outstanding debts. Moreover, the monthly installments to repay your debt consolidation loan are calculated at a lower interest rate in comparison to interest charged on credit cards. 

A crowded loan market can get confusing and predatory lenders may succeed in enticing you to make a wrong decision. By falling prey to their trap, you will only be adding to your debt woes instead of resolving them.

Thorough research, vigilance, and awareness of terminologies unique to this industry equip you to identify a reputed debt consolidation company. You need to partner with an entity that is high on integrity and transparent in its functioning. Rely on the below-mentioned steps to make an informed choice:

Brush Up Your Knowledge

Study the prevailing debt relief laws that safeguard you from shady companies waiting to take advantage of your ignorance. Educate yourself on the defined structure these companies have to conform to by streamlining creditor agreements and payment plans.

Avoid debt settlement companies that hold on to your funds till an amicable settlement figure is reached with each of your creditors. In contrast, debt consolidation partners promptly clear your unsecured debts, whether student or personal loans and medical or credit card bills.

Verify Credentials 

The company you select must be a legitimate not for profit agency possessing a valid license to practice in your state. You can also ask for its list of accreditations if not explicitly published on the company’s official website. 

Verify on the Better Business Bureau site if any complaints have been registered against the company in question. A rating is generally given to each debt consolidation company based on its ability to meet laid down ethical business standards.

Compare Service Costs

When you establish that the debt consolidation agency is a non-profit one, you are entitled to a free consultation. Utilize this initial session to gain valuable inputs on their service cost and the break-up of fees involved. 

Ideally, the payment structure is the same across the industry, with minimal service costs. Also, understand the debt consolidation company’s operating method to assess whether it will work for you.  

Examine Reviews

For added reassurance, scan through the reviews posted by customers who had an association with such companies earlier. Their feedback gives you valuable insights into their personal experiences, good or bad. It allows you to assess the reputation earned by the potential agency you are contemplating to hire. 

Take a call based on your gut feel, and if you are unsure about the genuineness of these comments, make further inquiries. Approach your family, friends, and acquaintances who will give you their unbiased opinion.

Ultimately partner with a company experienced in this field who can use their expertise to consolidate your debt and efficiently handle negotiations on your behalf.