Many consumers are hesitant to join a debt consolidation program when struggling with credit card debt because they fear such a program will hurt their credit. However, debt consolidation programs can actually improve a credit score because the debt is being paid off in full, thus improving the debt to income ratio. In addition, once all the accounts are paid in full, the debt consolidation company will often negotiate with the creditors to get the accounts reported in favor of the consumer.
debt consolidation company commonly offer free counseling services in addition to managing debt. These services are used initially to evaluate the consumer’s financial situation and determine the best options for debt relief. However, debt consolidation companies will also usually offer post debt consolidation counseling services in order to keep the consumer on track and avoid rebuilding credit card debt and unsecured debt that got them to this point in the first place.