Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
Good evening. I'm happy to assist you with your question.
Debt consolidation companies, generally speaking, set you up on a "payment plan" in which you send it a certain amount of money every week, month, etc. They then save your money, minus their fees, until you have enough to make a lump sum payment to one or more of your creditors. The difference in going to your credit card companies directly is that you then are assured that your credit card companies are in agreement with your proposal. With debt consolidation companies, you have no such assurances. In fact, your creditors can continue to pursue legal action against you while you're paying your money to the debt consolidation company.
The only true "debt consolidation" that everyone has to participate in is a bankruptcy.
Also, be aware of the tax consequences that may arise with any debt settlement program through either a debt consolidation company or a direct deal with the creditors.
That you so much for the opportunity to assist you. Best of luck to you!
Please remember to click the green "accept" button so I can receive proper credit and compensation for my assistance.
DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.
The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).