Semantics

I’ve noticed that there seems to be some confusion among consumers about different types of credit services.  There are many different types of services related to managing debt.  There are debt management, credit repair, and debt consolidation to name a few.  Many people don’t understand the differences between them.  To be honest, sometimes I get confused too between them all too.

So if you are contacted by a company that offers you credit repair services and tell you that they can help you with bad credit repair, please be careful and make sure you understand exactly what services you will be getting for your money.  Are they simply advising you to contact the credit agencies (or offering to contact the credit agencies on your behalf) to see if their reports are accurate and to tell them to remove any incorrect information?  You can do that for free by yourself!

Are they offering to consolidate your debt by putting all of your debt and payments in one account?  Sounds good – they offer to lower your monthly payments that way, but the credit experts are warning us that actually hurts your credit.  And debt management – well I think that is where they try to get the credit card companies to accept less money than you owe them.  The problem with that is you can’t use the credit cards anymore!  And you have to come up with a large lump sum to pay off your lower debt balance, which many of us can’t do!

So, folks, be careful and make sure that you fully understand what it is you are getting into!

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