If you are, consolidating at a lower interest rate can help you pay off your debt faster. But if there's even a small chance that you'll spiral back into debt, it's not for you.
Jean ChatzkyIf you default on an unsecured debt, you won't lose anything (except points on your credit score).
Jean ChatzkyGet your friends involved. Let your shopping buddies know that you're on a tight budget, and they can help you out when your willpower starts to weaken at the mall.
Jean ChatzkyOnce the settlement is completed, the credit card company will report it to the credit bureaus, which will then make a notation on your credit report that that account was paid by settlement. That's going to signal to future lenders that you left the last guy hanging. That's why, as with bankruptcy, debt settlement is an extreme option, one you shouldn't take lightly. It's not just an easy, cheap way to eliminate debt.
Jean ChatzkyDebt settlement companies work as a middleman between you and your creditor. If all goes well (and that's a big if), you should be able to settle your debts for cents on the dollar. You'll also pay a fee to the debt settlement company, usually either a percentage of the total debt you have or a percentage of the total amount forgiven.
Jean Chatzky