Everyone knows that every day average Americans have fallen so deeply into debt that even those who have been able to secure employment will have a hard time and may not recuperate entirely from debt unless an intervention strategy is put into effect.
In response, debt consolidation programs have been put into existence by governmental agencies to provide support tools and processes for debt relief through debt consolidation loans. Professional and expert advice is available from nonprofit counseling agencies that provide step-by-step guidance to achieve the goal of financial freedom through debt consolidation strategies.
What is the difference between debt consolidation and debt settlement?
Although debt consolidation and debt settlement are terms frequently confused their meanings are quite distinct from one another.
When one refers to debt consolidation, it means to coalesce or fuse multiple loans into only one consolidation loan that is paid to only one creditor. Debt consolidation can be put into effect in many ways. For example, it is possible to secure a collateral loan against a valuable asset. The most important thing is to get a separate loan that will pay the rest of the loans balances. The objective behind a debt consolidation loan option is to take advantage of a lower interest rate or interest rate savings. Focusing on only one payment obligation is not only convenient but effective in managing its payments in a timely and consistent manner.