Frequently Asked Questions about Consolidating Finances

Here are the answers to some of the most commonly asked questions about consolidating finances.

What does it mean to consolidate finances?

Consolidating finances means that you are combining many, high-interest debts into one, lower-interest loan. When you consolidate finances, you take out a debt consolidation loan on which you make one payment per month. Your payment is sent to an accredited non-profit company that will disperse your payment to your various creditors each month.

Why should I consolidate finances?

If you are struggling to deal with your debt or just want to get out of debt faster, debt consolidation can help you. Here are some of the reasons you might consolidate finances:

• To reduce monthly payments by as much as half
• To lower the total amount of your debt
• To slash interest rates down to an average of 0-8%
• To get out of debt faster (36-60 months, on average)
• To become debt-free
• To avoid bankruptcy or other damage to your credit

How do I apply to consolidate finances?

You simply click "apply now" anywhere you see it on our site to fill out our application. The application takes only a few minutes to fill out and is completely secure. For filling out the application, you will receive a free debt consultation in which we will review your situation to see how we can best consolidate your finances.

What's the difference between debt consolidation and debt settlement?

Debt consolidation and debt settlement are two services we offer to consolidate finances. Debt consolidation is meant for people with many, high-interest debts who would like the convenience of a single monthly payment. Debt settlement, on the other hand, is meant for people who are considerably overextended in debt. Usually, we recommend debt settlement for people who have over $20,000 in debt.

Will it hurt my credit to consolidate finances?

The effect consolidating your finances will have on your credit will largely depend on what service you choose. Debt consolidation does not have a negative impact on your credit. In fact, it can actually boost your credit score because it helps your balance-to-limit ratio and helps you pay bills on time. Debt settlement, on the other hand, will have an initially negative effect on your credit because you are required to stop paying your creditors for a while. The blemish left on your credit by debt settlement is easily repaired, though, and not as serious or permanent as bankruptcy, charge-offs, foreclosures, etc.

Learn how to rehabilitate your credit history on our "Rebuilding Credit" page.

Things you need to know