How is Debt Settlement different than a consolidation loan?
With a consolidation loan, you will group together all of your unsecured debts under one loan. Instead of making multiple payments to various creditors, you only have to make one payment to your loan consolidation company. You may be able to get a lower interest rate and a lower monthly payment with a consolidation loan but this is not always the case. You will still pay back the entire balance of your debts but it typically takes 7-10 years to do so. Debt settlement is not a loan. It is an agreed upon payoff amount that could be a fraction of your current balance. You typically cannot finance a settlement payoff. With most Debt Settlement programs, you will rectify your debt in a much shorter time frame.
