Debt settlement involves accounts being reported as settled for less than originally agreed. With a debt management plan, you’ll make one monthly payment to the credit counselor, who will then disburse the funds as agreed to your creditors until your debt is paid off.
What’s more, there are several ways to go about consolidating debt, and depending on your circumstances, one method might make more sense for you than another.
What’s more, if you continue the credit use habits that got you in trouble in the first place – like not making on-time payments – you could wind up even deeper in debt.
Another option for people with good credit scores may be to transfer balances from high-interest credit cards to a card with a lower interest rate.
Some credit card issuers offer very low rates or even zero interest as a promotion to entice new customers to open accounts with them or transfer balances from another card.
After the promotional period ends, the interest rate typically goes up.