Frequently Asked Questions

What is Debt Consolidation?

Debt consolidation is a process of bringing all of your debts together under one "roof", so to speak in order to make them manageable. Debt consolidation can be done either privately or with the help of a professional company that will negotiate with creditors on your behalf.

Can I Get Help Setting Up a Budget?

There are helpful sites out there that teach how to set up a budget and offer tools to assist with the process. In addition, certain non-profit credit consulting companies will speak with you personally about your situation and offer help in setting up a budget as well. If you are part of an organization such as the military, a club or financial group, services are probably offered in your network to assist with such items.

Can I Get a Home Equity Loan with my Current Lender?

Most major banks and credit unions do offer home equity loans and lines of credit and would appreciate your looking to refinance directly through them rather than going to a different bank. This would have the additional benefit for you of keeping your debt load in one place rather than having your mortgage with one bank and your home equity line of credit with another.

Don't Creditors Have to Offer me the Same Deal They Give to a Debt Management Service?

No, and there is currently no law that forces them to deal at all, let alone offer the same deals to the same people. Creditors offer discounts, reduced interests, or take settlement payments at their own discretion and in their own interest – in the hopes of receiving a reduced payment amount rather than nothing at all.

If I File for Bankruptcy Do I Have to Negotiate with My Creditors?

Depending on the size, scope and conditions surrounding your debt, you may be well advised to work with some of your creditors before attempting to file for bankruptcy. There are provisions in bankruptcy law that allow a lender to contest any filing and attempt to block a bankruptcy ruling from going through. Even though these situations are rare, they can happen and present themselves as a nasty surprise to consumers seeking relief.