You will make a single sum payment to the debt consolidation agency. In exchange, they will assume responsibility for the repayment of a portion of your debts. First, they will assume responsibility for paying your creditors. They accomplish this by making periodic payments from the monthly payment you make to them.
In addition, they will offer to negotiate a reduction in any interest payments and penalty fees imposed by your creditors. Having this burden lifted off their shoulders is what attracts many individuals to these services. However, there are a few disadvantages you should be aware of before signing.
A disadvantage of debt consolidation services is that they frequently make promises they cannot fulfill. For instance, you may have been enticed by the promise of a simple loan to pay off your outstanding creditor debts.
In actuality, however, you will end up paying more for this loan because your credit score has almost certainly suffered a severe decline. However, because the payments are spread out over an extended period of time, it may seem as though you are paying less.
In most cases, you will ultimately pay more than what you currently owe your creditors, but your monthly payments will be lower.
Another disadvantage is that these businesses do not always pay their creditors on time. Whether as a result of internal office efficiencies or fraud, a debt consolidation company may make late or no payments to the creditors. Consequently, not only will your credit score take a significant blow, but you will continue to owe money to the original creditors.
Before joining any agency, it is of the utmost importance that you perform your due diligence due to these two disadvantages. And, frequently, you will find that there are less drastic ways to resolve the persistent debts that are dragging you down.""
" - https://www.affordablecebu.com/
